The Vested Interests and the Welfare of the Common People

Paper Session

Sunday, Jan. 8, 2017 1:00 PM – 3:00 PM

Swissotel Chicago, St Gallen 2
Hosted By: Association for Evolutionary Economics
  • Chair: John Watkins, Westminster College

Care or Neoliberalism: Social Pathology?

William Waller
Hobart and William Smith Colleges
Mary Wrenn
University of Cambridge


This paper explores two conflicting social ethical systems. One is the dominant ethical standard of modern industrial society-neoliberalism. Neoliberalism’s ethical foundations grow out of classic liberalism which is essentially a natural law, natural right, conceptualization. This ethical system draws on the implicit characterization of human nature as immutably highly individualistic. As a consequence of this natural human condition, neoliberalism most deeply supports an overarching ethic of individual autonomy and individual responsibility. Thus neoliberalism redefines all other ethical principles in terms of individual autonomy so that freedom, equality and justice are all defined in individualistic terms. Behavior based on alternative conceptions is considered a manifestation of a social pathology.

Both institutional and feminist economics contrast this conception of human nature with a view of human beings as relational. In institutional economics this view of human nature is the result of instincts or adaptations and thus biologically determined. The ethical foundation of such a view requires a meta-ethic of interpersonal responsibility that supports an ethic of care. This view rejects the neoliberal view of ethics as in fundamental conflict with human nature. An ethic of care redefines responsibility in terms of democratic processes to assign responsibility and provide necessary care for human beings to experience freedom, equality, and justice in terms of their ability to participate in the democratic processes that determine the just allocation of responsibility for providing the necessary care. Behavior based on the neoliberal conception of human behavior is a manifestation of social pathology.

The Vested Interests and the Evolving Moral Economy of the Common People

Olivier Brette
University of Lyon


The British historian E.P. Thompson (1971) developed the concept of “moral economy” to analyse the food riot in eighteenth-century England. The current paper aims at elaborating on the concept of moral economy of the common people, by combining the insights of Thompson and those developed by Veblenian institutional economists. It highlights the commonalities between Thompsonian history and Veblenian economics in terms of both questions addressed and methodological principles endorsed. Finally it emphasizes the complementarities between these two bodies of work and suggests some ways to exploit them, in order to better understand the evolution of the moral economy of the common people over time.

Human Condition in Organizational Evolution: Mass Flourishing as the Casualty of Vested Interests

Lauri Pietinalho
Aalto University


People flourish when they are tapped into their intrinsic motivations. Whether that can happen depends largely on how the surrounding institutions prime the people involved. Experiencing flourishing requires that social conditions fulfill sense of autonomy, connectedness, and competence. I argue that systematical prevalence of such conditions within an organization requires either experiencing i) exploration of the new in creation of the organization, or ii) positive impact of its work on beneficiaries.

The former is associated with the early phases of organizational evolution. The latter could be the source of flourishing for more established institutions, but hierarchies of power typically block it. Those with power are distanced from experiencing the impact of the institution on beneficiaries, structurally leading to priming through extrinsic motivations and vested interests. This leads to the need to further control those who on the frontline could experience the impact, which inhibits flourishing from them as well.

The Fall of Common Man: From Loneliness to Precarious Classes

Ali Tarhan
Central Bank of the Republic of Turkey


Veblen’s arguments about the condition and future of the common man are dramatically right in an age of unfettered capitalism. The common man, squeezed between the dichotomy of labor and capital, has no way out but to retire from the public sphere and intolerable daily life. No doubt that, the Great Crisis of 1929 proves this desperation for both classes. However, an interregnum, roughly between the New Deal and the mid 1970s, shows the possibility of a welfare state and an affluent society. The latter two phenomena are institutionalized with a caring state, nuclear family, trade unions, rise of the middle classes, and the almost visible countervailing forces of society. During this era, estrangement and desperation are not widely recognized class issues other than individualistic problems. This epoch also witnesses the rise of centripetal forces in affluent societies. However, beginning with the 1960s, huge budget deficits, collapsing nuclear family, and eroding trust in governments, start destroying the fundamentals of welfare state. In the early 1970s, by the rise of Post-Fordist production, the proportional increase in the amounts of highly skilled workers and white collar employees gradually make trade unions weaker and mark the commencement of centrifugal forces in societies. In this “Liquid Modernity”, Veblenian escapism replaces its place with a vague sense of belonging since the Foucauldian capillary power of capitalist classes disguises the landmarks of supremacy and leaves no certain place to escape. Therefore, this study is an attempt to decode the rise and fall of the common man.

Karl Polanyi’s Criticism of Economics and the Origin of His Poor-Relief Ideas

Takato Kasai
Doshisha University


Karl Polanyi’s criticism of capitalism in The Great Transformation (1944) has influenced; however, in economics his thought was never the mainstream. This research shows the genealogy of a social organization for an inclusion of poverty by the investigation of Polanyi’s unfinished theory that incorporates Jeremy Bentham's perspective.

Polanyi criticized the connection of utilitarianism with economic liberalism by focusing on Bentham. This connection supports creation of a free market through 'commodity fiction', and accepts individual sacrifice, resulting in two outcomes: neglect of basic human rights and loss of individual liberty. According to Polanyi, the rationality of utilitarianism leads to a conflict regarding wage determination, resulting in both equilibrium and a walkout. Therefore, the utilitarian consequence would merely endanger society.

Polanyi highly appreciated Bentham as a social reformer with pragmatic thoughts, especially Industry-house and Panopticon, and simultaneously Polanyi had mixed feelings regarding the views of Bentham. Indeed, Bentham’s liberalism did not mean laissez-faire but explained the importance of indirect government intervention in the economy in order to increase human happiness. Polanyi followed Robert Owen’s thought about social organization for pauperism. Additionally, Bentham had a great influence on the emergence of this idea with further contributions from Robert Owen. Hence, the genealogy of social organization emerges as Bentham–Owen–Polanyi.

In conclusion, it becomes clear that Polanyi criticized only sum-ranking, but found the social factor in utilitarian. We can apply Polanyi’s unfinished social organization as a blueprint for social inclusion of poverty in current times.
JEL Classifications
  • B5 - Current Heterodox Approaches
  • I3 - Welfare, Well-Being, and Poverty