Open almost any introductory economics textbook. You meet a character in the first chapter. He has unlimited wants and limited means. He ranks his preferences and he maximizes his satisfaction. He trades his way toward the best deal he can get.

Economists call him homo economicus, or economic man. Most economists will tell you that he is a simplification rather than a claim about human nature, and that defense is fair. The discipline also spent forty years to complicate him. Amartya Sen attacked the model as a portrait of a “rational fool” who cannot distinguish a preference from a commitment (Sen, 1977). Elinor Ostrom documented real communities that govern shared resources through rules the model says should fail (Ostrom, 1990). Behavioral economics measured the systematic ways that real choices depart from the model.

The character still matters, because he survives in the popular understanding of the economy and in a great deal of policy argument. Almost everything in that first chapter rests on the assumption that he is real, and that he is us.

Anthropology makes its first contribution here, and the accurate version of that contribution is narrower than the slogan. Anthropology finds maximizers everywhere. It finds people who haggle, who calculate, and who defect on their obligations to kin. It also finds that the institutions of a society define what counts as a payoff, and that those definitions vary a great deal. People maximize standing, or safety, or the good opinion of a lineage, as often as they maximize goods.

So the fieldwork record holds people who give away wealth to gain standing, people who refuse profitable trades that would shame a neighbor, and people who work far less than their tools allow because they have enough. Exchange runs through obligation, kinship, and ritual as often as through price. The useful claim is about the frame around the calculation rather than about the absence of calculation.

Marshall Sahlins made a version of this point most memorably when he argued that hunter-gatherers were “the original affluent society.” They were affluent because their wants were few and easy to meet, rather than because they produced a great deal. “There are two possible courses to affluence,” he wrote. “Wants may be ‘easily satisfied’ either by producing much or desiring little” (Sahlins, 2017). Economics treats scarcity as the universal human condition. In his telling, scarcity is a particular cultural achievement of our own society rather than a law of nature.

Sahlins overstated his case, and I say so at the start. His famous work-hours figures rested on a thin dataset. That dataset counted only the time people spent to acquire food, and it left out the firewood, the cooking, the tool repair, and the food processing. Later scholars added those tasks back in, and the leisured forager looked much busier (Kaplan, 2000). The “original affluent society” survives best as a provocation rather than as a measured fact about working hours.

Anthropology already fought about all of this internally, and the fight deserves a name. In the 1960s the formalists argued that economic theory applies everywhere, because scarcity and choice are universal. The substantivists, who followed Karl Polanyi, argued that the theory describes market societies only, and that other societies need categories of their own. The debate ended in a stalemate rather than a victory, and the substantivist program lost ground inside the discipline afterward (Hann & Hart, 2011). This series revives a substantivist question on purpose, and the reason is that the object of study changed. Polanyi’s categories describe a market society, and a market society is now the thing most readers live inside.

This is the first entry in a series on the anthropology of unregulated capitalism. Later posts examine how capitalism traveled with colonialism, how it manufactures delay on climate, how it produces inequality and precarity, and how it strains democracy. The last post asks what pushes back when markets damage the societies they run through. Before any of that, this post establishes the vocabulary that the rest depends on. The central term is a distinction, and it comes from a Hungarian émigré who watched two world wars and a global depression and concluded that everyone misdiagnosed the disease.

Markets are old. A market society is new.

Karl Polanyi published The Great Transformation in 1944, in the wreckage of the market order that collapsed into fascism and war (Polanyi, 1944). His argument runs against both the free-market right and much of the Marxist left. Both tend to treat the market as the natural endpoint of economic development, which societies reach once they grow large and sophisticated enough to shed their traditional restraints. Polanyi says this gets the history backward.

Markets are ancient and very widespread. Here a market means a place or an occasion where people exchange goods at negotiated prices. Archaeologists and historians find them in most times and places, and there is nothing modern or Western about a bazaar. Polanyi insists that a different thing is the genuine historical novelty, and he calls it a market society. In a market society, the market becomes the organizing principle of the whole society rather than one institution among many. Price-making markets settle the production and the distribution of everything, including the things that human life is made of.

Markets are not universal, and the exception matters more than the rule here. The Andes supply the clearest counterexample, and it is the region I know best. The Inka state ran a large, complex, and wealthy economy with no price-making markets and no money. It moved goods through labor obligation, state storehouses, and reciprocal claims between households, communities, and the state (Murra, 1980). A society can be very large and very sophisticated and still organize its economy by other means. That is the whole of Polanyi’s point, stated by a case rather than by a theory.

In most societies before the nineteenth century, Polanyi argued, the economy sat inside social relations. People produced and exchanged inside webs of kinship, religion, custom, and political obligation, and those webs set the terms. The great transformation of his title is the moment when this relation inverts. For the first time, a society tries to run the relation the other way and to organize social life to serve a self-regulating market.

The technical name for the older condition is embeddedness. Economic activity normally sits inside non-economic social institutions, and those institutions govern it. A market society is the strange case where the economy claims to float free of those institutions and to obey only its own laws of supply and demand. Polanyi’s verdict on that project was blunt. “The idea of a self-adjusting market,” he wrote, “implied a stark Utopia. Such an institution could not exist for any length of time without annihilating the human and natural substance of society” (Polanyi, 2001, p. 3).

One caveat belongs here, because the best Polanyi scholarship insists on it, and because to get this point wrong is the most common way to misread him. It is tempting to say that the market simply became disembedded in the nineteenth century, floated up out of society, and started to run on its own. Fred Block argues that Polanyi’s own text is ambivalent on this point, and that the more coherent reading holds the economy to be always embedded in society (Block, 2003). Block later restated the argument in shorter form (Block, 2021).

A fully disembedded market is a logical impossibility rather than an achieved fact. The market liberals kept moving toward that ideal and never reached it, and the effort itself does the damage. The self-regulating market is a permanently incomplete project, and someone must force it onto a society that keeps resisting it. That resistance is the double movement, and the double movement is where this series ends.

The strongest objection to Polanyi

Polanyi’s central historical claim carries the weight of this series, so it deserves the hardest scrutiny in this post. The claim is that a market society is a nineteenth-century invention. A large body of economic history disputes it.

Jan de Vries described an “industrious revolution” in northwest Europe from about 1650. Households reallocated their own labor toward production for the market and toward the purchase of market goods, long before the factories arrived (de Vries, 1994). Sheilagh Ogilvie showed that markets in pre-industrial Europe were deep, and that the institutions around them distributed the gains through conflict and privilege (Ogilvie, 2007). Avner Greif traced the contract enforcement institutions that made long-distance medieval trade work (Greif, 2006). Price-making markets for land and for labor existed, and they were widespread well before 1800.

Polanyi’s own central empirical case also failed. He treated the Speenhamland system of poor relief as the hinge of the transformation. Fred Block and Margaret Somers are sympathetic readers, and they returned to the record and concluded that no canonical account of Speenhamland survives it, including Polanyi’s (Block & Somers, 2003). The bread scale was applied too narrowly to produce the effects attributed to it.

What survives is the distinction, and it needs a more careful statement than Polanyi gave it. The claim that holds concerns the organizing principle rather than the presence or the absence of markets. Medieval and early modern Europe had markets for land and for labor, and those markets sat inside guilds, manorial rights, poor laws, settlement rules, and church regulation. Those institutions limited who could sell what, to whom, and at what price. The nineteenth-century project tried to remove the limits and to let price alone settle the allocation of land and labor. That project is the novelty, and it is a matter of degree rather than a clean break.

I state this openly for a reason. A series that confesses small errors and hides the large one performs rigor rather than practices it. This is the largest weak spot in the foundation of the series, every later post inherits it, and you should read the later posts with it in mind.

Land, labor, and money are fictitious commodities

To turn a society into a market society, you must be able to buy and sell the things that the society is made of. Polanyi’s sharpest tool is his account of what that requires. A real commodity is something that someone produced for sale on a market. By that definition, the three most important commodities in a market economy are not commodities at all. Land is nature, and no one produced it. Labor is human beings who live their lives, and no one produces that for sale either.

Money is a token of purchasing power. The state and the banking system create it, rather than manufacture it for exchange. “Labor, land, and money are obviously not commodities,” Polanyi wrote. Their “commodity description” is “entirely fictitious” (Polanyi, 2001, pp. 75-76).

He called them fictitious commodities, and the word “fictitious” does precise work. To run a market society, you must treat land, labor, and money as if they were ordinary commodities. The fiction is not harmless, because the pretense has consequences that ordinary supply and demand cannot absorb.

Treat labor as a pure commodity, price it by the market, and shed it when demand falls. You then treat people as things to use up and discard, and the wreckage shows up as broken health, broken families, and broken communities. Treat land as a pure commodity, and you get the exhaustion of soils, forests, rivers, and finally the climate. Treat money as a pure commodity, and you get the booms and the crashes that periodically destroy the businesses caught in them.

Those three claims state the thesis of the whole series as though it were established. This post does not establish it. Each claim is a promise that a later post must keep with evidence about specific places, specific policies, and specific people, and you should hold me to that. The fictitious commodities mark where to look. Climate, precarity, and inequality each sit on one of these three fault lines.

The double movement

If the story ended there, it would be a straightforward tragedy, and unregulated markets would simply destroy societies. Polanyi’s most hopeful idea is that they do not, because societies protect themselves. He called the pattern the double movement. Markets expand and try to commodify more of life. The people whose lives become commodities then organize to protect themselves, and they use the state, the law, the union, the cooperative, and the ballot to do it.

“It can be personified,” Polanyi wrote, “as the action of two organizing principles in society.” One is “the principle of economic liberalism,” the drive to extend the self-regulating market. The other is “the principle of social protection aiming at the conservation of man and nature” (Polanyi, 2001, pp. 138-139).

Factory acts, child labor laws, the eight-hour day, public health regulation, unemployment insurance, environmental protection, deposit insurance, and central banking are all moves in the counter-movement. They are how a society defends its own substance against commodification. Polanyi’s own century suggests that liberalizing phases do not last. He was also clear that the counter-movement can take ugly forms as well as democratic ones. Fascism was one of the ways a society reacted against a market that failed it.

The double movement has a weakness, and I name it here rather than later. It absorbs any outcome after the event. Protection happened, or fascism happened, or nothing has happened yet, and the framework accommodates all three. That flexibility makes it a strong description and a weak prediction. To make it do real work, a post must say in advance which protections a specific movement demands, who organizes them, and what would count as a failure of the counter-movement. I will hold the later posts to that standard.

How anthropologists study capitalism now

Polanyi gives the frame. The discipline that grew up after him gives the fieldwork. For the last half century it insisted on a few points that economics tends to forget.

The first point is that capitalism does not exist in the singular. Michael Blim surveyed the field at the turn of the millennium and argued for the study of “capitalisms in the plural,” a family of divergent formations rather than one uniform system that marches everywhere toward the same shape (Blim, 2000). Japanese capitalism, Silicon Valley capitalism, and the capitalism of a Bolivian mining town are related but genuinely different social arrangements. Anthropology studies the differences, because the differences show what is contingent and changeable rather than fixed.

Anthropology shares this point rather than owns it. Political economy reached a related conclusion at the same time, and the varieties-of-capitalism literature sorted the rich democracies into liberal and coordinated market economies by their institutions (Hall & Soskice, 2001). The distinct contribution of anthropology is the scale of observation. It shows how one variety of capitalism is lived, taught, and reproduced in a single place.

The second point concerns neoliberalism, the word that now names the current phase. The word needs a careful definition, because people stretch it until it means little more than “things I dislike about the economy.” Tejaswini Ganti reviewed how anthropologists actually use it, and she identified two distinct approaches. In the first, neoliberalism is a set of structural economic policies, and deregulation, privatization, and the withdrawal of the state from provision reshape the material chances people have in life. In the second approach, which comes from Foucault, neoliberalism is a governing rationality that produces self-managing, entrepreneurial subjects who understand themselves as firms and their lives as investments (Ganti, 2014).

Mathieu Hilgers adds a third, culturalist strand, and he argues that the three approaches are complementary rather than rival (Hilgers, 2010). The distinction matters for this series, because unregulated capitalism operates on both registers at once. It changes the rules that people live under, and it changes how people understand themselves.

Loïc Wacquant makes the most important correction to the popular image of neoliberalism. Most descriptions say that neoliberalism shrinks the state, and that government steps aside so the market can breathe. Wacquant argues that this is close to the reverse of the truth. Neoliberalism actively re-engineers the state, and the state works harder than ever. It first builds and protects the markets that it calls natural. It then disciplines the people that those markets leave behind.

He calls the result the “Centaur-state,” an institution “liberal at the top and paternalistic at the bottom” (Wacquant, 2012). It applies laissez-faire to corporations and to the wealthy. It turns a growing apparatus of workfare, surveillance, and imprisonment onto the poor.

The third point is that capitalism is not made only in markets and workplaces. The authors of the “Gens” manifesto are Laura Bear, Karen Ho, Anna Tsing, and Sylvia Yanagisako. They argue that kinship, gender, race, sexuality, and intimate life continuously generate accumulation and inequality, in the household as much as at the trading desk. “Class does not exist,” they write, “outside of its generation in gender, race, sexuality, and kinship” (Bear, Ho, Tsing, & Yanagisako, 2015). An anthropology of capitalism must therefore look at unpaid care work, at inheritance, and at who bears risk inside a family, and not only at wages and prices.

Sherry Ortner named the mood that this scholarship settled into. She calls it “dark anthropology,” an ethnography trained on the harsh dimensions of life under neoliberalism, on power, domination, precarity, and the hardening of inequality (Ortner, 2016). The label fits much of what this series covers, and her own warning applies to it. Dark anthropology must balance against an anthropology of what people build, resist, and hope for, or it becomes mere despair.

What the word “unregulated” can mean

Two claims in this post pull against each other, and the tension is worth a plain statement. The first claim defines unregulated capitalism as a phase in which the liberalizing half of the double movement dominates. The second claim, from Wacquant, says that the neoliberal state is hyperactive. It builds the markets, and it polices the people the markets fail.

If Wacquant is right, the current phase is re-regulated in a particular direction rather than unregulated. The rules did not disappear. They moved. They now protect capital, property, and contract, and they discipline labor and the poor.

I keep the word “unregulated” for this series, and I owe you the reason. The word names how this phase describes itself, and that self-description does real political work. A protection is much easier to remove if you can call its removal a return to nature. Read “unregulated” throughout this series as a claim that the winners of the current phase make about themselves, rather than as my own account of how the state behaves. Where the two conflict, Wacquant is the better guide.

Deregulation therefore dismantles protections that societies built at real cost and over generations, rather than returning a society to a natural market state. Societies built those protections because unprotected markets hurt them the first time.

Ethnography can go anywhere, including the top

An old and wrong assumption holds that anthropologists study the powerless, the village, the margin, and the far away. Some of the most important work on capitalism does the opposite and studies the command centers. Karen Ho spent years in fieldwork inside Wall Street investment banks. She found a workforce that lives in extreme insecurity rather than a cabal of confident masters of the universe. The banks recruit from a handful of elite schools into a culture of constant hiring, firing, and bonus payments. That culture teaches the recruits to treat their own precarity as a badge of intelligence.

The revealing part is what the bankers did with that experience. They took the churn of their own working lives, which Ho calls a “culture of liquidity,” and they projected it outward as a prescription for everyone else. That prescription took the form of shareholder value, perpetual restructuring, and the downsizing of workers at companies where the bankers themselves would never work (Ho, 2009).

Two limits apply to her account. The fieldwork predates the 2008 crisis, so it describes the culture that produced the crisis rather than the culture that followed it. Her origin story for shareholder value also competes with a simpler one from finance itself. Michael Jensen and William Meckling gave shareholder value its theoretical form in 1976, and agency theory then spread through business schools and boardrooms on its own (Jensen & Meckling, 1976). Ho supplies the mechanism of transmission and the culture that made the theory feel obvious, and she supplements that history rather than replaces it.

Ho’s book is one point on a longer line of anthropological work that this series draws on. The other works supply the deep history, and I name them now. Eric Wolf’s Europe and the People Without History dismantled the idea that the societies Europe colonized were isolated and static before contact. It showed them instead as active participants in a single interconnected world economy (Wolf, 1982). Sidney Mintz’s Sweetness and Power followed sugar from Caribbean slave plantations to the tea tables of the English working class, and it showed how a single commodity tied slavery, empire, and industrial labor into one system (Mintz, 1985).

Anna Tsing’s The Mushroom at the End of the World introduced “salvage accumulation,” the way capitalism captures value that it did not produce and cannot fully control. It made precarity the general condition of life in what she called capitalist ruins (Tsing, 2015). Colonialism, commodity chains, and salvage each get their own turn later in this series.

I also use David Graeber’s Debt: The First 5,000 Years. It used the anthropological and historical record to demolish the “myth of barter,” the story in which money arose to fix the inconveniences of direct swaps of goods. Graeber showed that credit and debt relations came first, and that the barter economy of the economics textbooks never existed as described (Graeber, 2011). Scholars widely accept that argument. Critics were also right to flag factual errors elsewhere in the book, and the best known is a garbled account of the founding of Apple, which Graeber called “flagrantly wrong” and blamed on a damaged edit (Graeber, 2012).

One note on a venue. Several pieces I cite, including Ortner’s essay, appeared in HAU, which in 2018 became the center of a controversy over the treatment of its staff (Flaherty, 2018). The dispute concerns the management of the journal rather than the scholarship it published.

One absence needs an explanation too. Marx and Weber are nearly missing from this post, and they are two of the three obvious foundations for any anthropology of capitalism. I chose Polanyi because he supplies the one distinction this series is built on. Marx supplies the theory of accumulation and exploitation, and Weber supplies the account of rationalization and of the ethic that made accumulation a duty. Both arrive in later posts, and the post on inequality cannot be written without Marx.

The road ahead

That is the toolkit. Markets are old and human, and a few large societies ran without them. A market society is a recent and contested invention, and it runs by the treatment of land, labor, and money as commodities that they are not. It therefore keeps colliding with the human and natural world it depends on, and societies keep organizing to protect themselves in the counter-movement that Polanyi called the double movement.

Anthropology insists on three further points. There are many capitalisms rather than one. Neoliberalism actively reworks the state rather than retreats from it. Capitalism is generated in kinship, race, and intimate life as much as in markets. All of this is visible only if you go and look, whether the site is a foraging camp, an Andean village, or a Wall Street trading floor.

The rest of the series can now do its work. The next post follows capitalism outward with European colonialism. It asks what it means that the wealth of the industrial core was drained from a colonized periphery, and that the drain arguably never stopped. The series then turns to climate and the anthropology of manufactured delay, then to inequality and precarity, and then to what unregulated capitalism does to democracy. It finally returns to Polanyi, to the double movement, and to the question of what pushes back when markets damage a society.

Every one of those posts argues about a market society that strains against its own fictions. This post was about how to see that the market society is the invention. To see it as an invention is the first step toward the belief that we could build it differently.

References

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Blim, M. (2000). Capitalisms in late modernity. Annual Review of Anthropology, 29, 25-38. https://doi.org/10.1146/annurev.anthro.29.1.25

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Block, F. (2021). The always instituted economy and the disembedded market. Journal of Economic Issues, 55(3), 651-657. https://www.tandfonline.com/doi/abs/10.1080/00213624.2021.1945883

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Polanyi, K. (2001). The great transformation: The political and economic origins of our time (2nd Beacon ed.). Beacon Press. (Original work published 1944. This edition carries a foreword by Joseph Stiglitz and an introduction by Fred Block, and all page numbers above refer to it.) https://www.beacon.org/The-Great-Transformation-P46.aspx

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Tsing, A. L. (2015). The mushroom at the end of the world: On the possibility of life in capitalist ruins. Princeton University Press. https://press.princeton.edu/books/paperback/9780691220550/the-mushroom-at-the-end-of-the-world

Wacquant, L. (2012). Three steps to a historical anthropology of actually existing neoliberalism. Social Anthropology, 20(1), 66-79. https://doi.org/10.1111/j.1469-8676.2011.00189.x

Wolf, E. R. (1982). Europe and the people without history. University of California Press. https://www.ucpress.edu/book/9780520268180/europe-and-the-people-without-history