“Writing in 1944, the year of the Bretton Woods Conference, Polanyi suggested that the extension of the institutions of the market over the course of the nineteenth century aroused a political reaction in the form of associations and lobbies that ultimately undermined the stability of the market system. He gave the gold standard a place of prominence among the institutions of laissez faire in response to which this reaction had taken place. And he suggested that the opening of national economic decision making to parties representing working-class interests had contributed to the downfall of that international monetary system. In a sense, this book asks whether Polanyi’s thesis stands the test of time. Can the international monetary history of the second half of the twentieth century be understood as the further unfolding of Polanyian dynamics, in which democratization again came into conflict with economic liberalization in the form of free capital mobility and fixed exchange rates? Or do recent trends toward floating rates and monetary unification point to ways of reconciling freedom and stability in the two domains?”

— Barry Eichengreen , Introduction

Source: Globalizing Capital (2008), Chapter 1. Introduction

Adopted from Wikiquote. Last update June 3, 2021. History

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Barry Eichengreen 10

Economist 1952

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“Nineteenth-century civilization rested on four institutions. The first was the balance-of-power system which for a century prevented the occurrence of any long and devastating war between the Great Powers. The second was the international gold standard which symbolized a unique organization of world economy. The third was the self-regulating market which produced an unheard-of material welfare. The fourth was the liberal state. Classified in one way, two of these institutions were economic, two political. Classified in another way, two of them were national, two international. Between them they determined the characteristic outlines of the history of our civilization.
Of these institutions the gold standard proved crucial; its fall was the proximate cause of the catastrophe. By the time it failed, most of the other institutions had been sacrificed in a vain effort to save it. But the fount and matrix of the system was the self-regulating market. It was this innovation which gave rise to a specific civilization.”

Karl Polanyi book The Great Transformation

The Great Transformation (1944), Ch. 1 : The Hundred Years' Peace

“As was rightly pointed out by Karl Polanyi in the 1940s, the 19th century laissez-faire regime can be thought of as one in which society is forced to conform to the needs of the market mechanism. "Instead of the economy being embedded in social relations, social relations are embedded in the economic system" in this laissez-faire regime. However, it was precisely because of this that the system gradually disintegrated from the early 20th century into economic and social chaos. "Since society was made to conform to the needs of the market mechanism, imperfections in the functioning of that mechanism created cumulative strains on the body social."”

Eisuke Sakakibara (1941) Japanese economist and critic

The End of Market Fundamentalism (1999)

“To suggest that the global market-place of the twenty first century there will be no role for the state and the public sector is clearly nonsense.”

Bob Rae (1948) Canadian politician

Source: The Three Questions - Prosperity and the Public Good (1998), Chapter Four, Self-Interest and the Public Interest: Taxes, Debts, and Deficits, p. 64

“I want to make the country a favourable place to do business and an attractive place in which to invest by reforming the markets and systems in a fair and transparent manner based on international standards.”

Roh Moo-hyun (1946–2009) 9th President of the Republic of Korea

Excerpts from inaugural address (25 February 2003)

“Some institutions within the market are associated with exchange and contracts in an elemental sense (such as the legal system and the customs which govern the contract)… These would be present even if a formal market did not exist. Other institutions are specifically to do with the development of a market and the coordination of a large number of exchanges in an organized manner.”

Geoffrey Hodgson (1946) British economist

Source: Economics and Institutions, 1988, p. 174

“Proudhon was a voluntary hermit in the political world of the nineteenth century. He sought no followers, indignantly rebuffed suggestions that he had created as system of any kind, and almost certainly rejoiced in the fact that he accepted the title anarchist in virtual isolation.”

George Woodcock (1912–1995) Canadian writer of political biography and history, an anarchist thinker, an essayist and literary critic

Prologue
Anarchism : A History of Libertarian Ideas and Movements (1962)

“The free market tide has now receded. In its place has come state capitalism, a system in which the state functions as the leading economic actor and uses markets primarily for political gain.”

Ian Bremmer (1969) American political scientist

"State Capitalism Comes of Age," http://www.foreignaffairs.com/articles/64948/ian-bremmer/state-capitalism-comes-of-age Foreign Affairs (May/June 2009).

“An almost hysterical antagonism toward the gold standard is one issue which unites statists of all persuasions. They seem to sense—perhaps more clearly and subtly than many consistent defenders of laissez-faire—that gold and economic freedom are inseparable, that the gold standard is an instrument of laissez-faire and that each implies and requires the other.”

Alan Greenspan (1926) 13th Chairman of the Federal Reserve in the United States

Gold and Economic Freedom http://www.constitution.org/mon/greenspan_gold.htm 1966
1950–60s

“If the prime minister wants to stay in so many EU institutions, why leave the single market which she admitted will put barriers in place over trade?”

Leanne Wood (1971) Welsh Plaid Cymru politician

Brexit speech by Theresa May criticised by first minister Carwyn Jones https://www.bbc.co.uk/news/uk-wales-politics-43260699 BBC News (2 March 2018)
2018

“We shall here define the market as a set of social institutions in which a large number of commodity exchanges of a specific type regularly take place, and to some extent are facilitated and structured by those institutions. Exchange as defined above, involves contractual agreement and the exchange of property rights, and the market consists in part of mechanisms to structure, organize and legitimate these activities. Markets, in short, are organized and institutionalized exchange. Stress is placed on those market institutions, which help to both regulate and establish a consensus over prices and, more generally, to communicate information regarding products, prices, quantities, potential buyers and potential sellers.”

Geoffrey Hodgson (1946) British economist

Source: Economics and Institutions, 1988, p. 174

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Barry Eichengreen 10

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