Table Of ContentECONOMY’S TENSION
E ’ T
CONOMY S ENSION
The Dialectics of Community and Market
(cid:1)
Stephen Gudeman
Berghahn Books
New York • Oxford
Published in 2008 by
Berghahn Books
www.berghahnbooks.com
©2008 Stephen Gudeman
All rights reserved. Except for the quotation of short passages
for the purposes of criticism and review, no part of this book
may be reproduced in any form or by any means, electronic or
mechanical, including photocopying, recording, or any information
storage and retrieval system now known or to be invented,
without written permission of the publisher.
Library of Congress Cataloging-in-Publication Data
Gudeman, Stephen.
Economy’s tension : the dialectics of community and market / Stephen
Gudeman.
p. cm.
Includes bibliographical references.
ISBN 978-1-84545-514-9 (hbk. : alk. paper)
1. Economic anthropology. 2. Economics—Sociological aspects. I. Title.
GN448.2.G84 2008
306.3—dc22
2008008212
British Library Cataloguing in Publication Data
Acatalogue record for this book is available from the British Library
Printed in the United States on acid-free paper
ISBN-13: 978-1-84545-514-9 hardback
(cid:1)
CONTENTS
ACKNOWLEDGEMENTS vii
1. MODELS,MUTUALITY,ANDTRADE 1
2. EXCHANGEASMUTUALITY 27
3. TRADE’SREASON 48
4. PROPERTYANDBASE 74
5. CONTINGENCYORNECESSITY? THEDIALECTICOFPRACTICES 95
6. MAKINGMONEY 124
7. SEEKINGABALANCE 148
REFERENCES 166
INDEX 182
(cid:1)
ACKNOWLEDGEMENTS
In the course of writing this book I have been fortunate to receive com-
ments and ideas from numerous colleagues including James Carrier,
David Graeber, J-K Gibson Graham (Julie Graham and Katherine Gib-
son), Chris Hann, Arjo Klamer, Frederique Appfel-Marglin, David Ruc-
cio, Will Milberg, Ivo Strecker, and Thomas Wallgren. Over the years,
Keith Hart and I have sustained a conversation on economic anthropol-
ogy, and he has been a supporter and helpful critic. I thank as well the
Austrian economics group at George Mason University who provided
me with many comments on an earlier version of Chapter 3. Stephen
Marglin and I independently reached the idea of two forms of “episte-
mology,” and I have been fortunate to learn his thoughts on econom-
ics. Portions of the book were presented at the Max Planck Institute for
Social Anthropology in Haale, and I appreciate the support of Chris
Hann and his colleagues. I am especially indebted to the Swedish Col-
legium for Advanced Study in the Social Sciences in Uppsala, where I
began this work as a fellow in 2002–03. I thank its directors, Björn Wit-
trock, Barbro Klein, and Göran Therborn, and my helpful colleagues
there, especially Patricia Springborg. During that academic year, Stef-
fan Löfving organized a conference on my work at the University of
Uppsala and published the results as a book (Löfving 2005). I am very
grateful to him for his thoughts and support, and to the book’s contrib-
utors, whose responses partly stimulated this volume.
A version of some material in Chapters 2 and 4 was published in
2005 as “Community and Economy: Economy’s Base,” in Handbook of
Economic Anthropology, ed. James G. Carrier (Cheltenham: Edward El-
gar, pp. 94–106). An earlier version of Chapter 3 appeared in 2006 as
“Trade’s Reason,” Max Planck Institute for Social Anthropology Work-
ing Paper no. 81, Haale/Saale. ISSN 1615-4568.
(cid:1)
1
MODELS, MUTUALITY, AND TRADE
Why are we obsessed with calculating our selections? Why must we al-
ways make the “best” choice to feel satisfied? For many of us, rational
selection is like a grammar: we use it to form acceptable statements and
actions, and we invoke it to persuade others. We even value the act of
choosing itself. But why does calculative reason dominate the lives of
many in market economies, especially in the United States? Is it part
of our genetic inheritance? Are we naturally avaricious? Have profit-
seeing producers drawn us into their way of life? If so, how do we
explain their calculated cravings and understand cross-cultural differ-
ences in the prominence of profit making? In this essay, I argue that cal-
culative reason develops and expands with competitive trade.
If this answer to a complex question seems brief, it had a long birth.
My puzzlement about the salience of calculated choice began during
my initial fieldwork in Panama, but I did not frame it as a puzzle until
I left the country and undertook more field studies. In Panama I lived
with my wife in a small village where the people were shifting from the
subsistence farming of rice, maize, and beans to cash cropping sugar
cane. I wanted to study this transition and began by sketching decision-
trees that captured their flow of choices and by soliciting their subjec-
tive probabilities for the outcomes in order to understand their crop
selections. I quickly found that my questions about rational choice did
not resonate with them, nor did the concept explain the social and eco-
nomic conditions in which they were living. I dropped that analysis to
study their material life ethnographically as well as other aspects of the
culture. But I was puzzled about the gap in our reasoning.
After this work, I realized that my puzzle about the prominence of
calculated choice lies at the heart of a disagreement in economic an-
thropology, evokes a difference between anthropology and economics,
and often separates the social sciences, if not the social sciences and the
humanities. In anthropology, Bronislaw Malinowski’s (1961 [1922]) early
critique of the concept of “rational man” had a subterranean influence
on subsequent generations of anthropologists. Were the Trobriand Is-
landers, whom he so carefully studied, self-interested choosers, or were
they acting according to other modes of reason, such as reciprocity?
Two of his students burned the candle at both ends. In the style of Ma-
linowski, Raymond Firth provided innumerable contextual studies of
the Pacific island of Tikopia, but with his early training in economics
2 | Economy’s Tension
Firth emphasized how the people chose to their advantage within con-
straints (1951, 1964, 1965 [1939]). Edmund Leach, in a famous study of
politics in Highland Burma (1954), explicitly presumed that the actors
were choosing and maximizing political rewards even as he presented
a cultural, structural, and contextual analysis of their polity. The issue
was most clearly revealed in the internal anthropological debate dur-
ing the 1960s between the “formalists,” who followed a neoclassical,
deductive line that centers on the supposed universality of “economic
man,” and the “substantivists,” who were developing an institutional
and inductive perspective based on Karl Polanyi’s work.1 As for the
difference between anthropology and economics, the question of calcu-
lated choice surfaced in the economist Frank Knight’s quarrel with the
anthropologist Melville Herskovits, who then rescinded his anthropo-
logical position, to the dismay of Karl Polanyi (Herskovits 1953 [1940]
507–531; Polanyi 1968:142).2
These controversies reflect a larger issue in the social sciences: whether
to adopt an individualistic or a relational understanding of society, a
debate that might be encapsulated as the difference between Adam
Smith’s The Wealth of Nations(1976 [1776]), and Emile Durkheim’s The
Division of Labor in Society(1933 [1893]) and The Elementary Forms of Re-
ligious Life (1995 [1912]). Leaving aside his earlier work The Theory of
Moral Sentiments (1976 [1759]), Smith is often seen as the founder of
modern economics and is famous for his pithy statement that places
self-interest with its benefits at the center of markets:
It is not from the benevolence of the butcher, the brewer, or the baker that
we expect our dinner, but from their regard to their own interest. We ad-
dress ourselves, not to their humanity but to their self-love, and never
talk to them of our own necessities but of their advantages. (1976 [1776]:
18)
In contrast, Durkheim claimed that society is held together not only
by a general division of labor but a sharing that he often labeled the
“conscience collective.” To Adam Smith he might have replied, “If
interest relates men, it is never for more than some few moments”
(1933:203) and added, “a contract … is possible only thanks to a regu-
lation of the contract which is originally social “ (1933:215). But influ-
enced by Rousseau (Durkheim 1960), Durkheim struggled to explain
the “origin” of this collective sense. From his earlier to his later work,
Durkheim suggested that it arose as the social, moral, and demographic
density of society increased. (In a strange twist, I shall return to Durk-
heim at the end of my story to suggest that he may provide hints for
contemporary economists who try to explain the social context of inno-
vations that lead to economic growth and profits.)
One hardly finds echoes of this explanatory struggle in standard eco-
nomics.Some economists (such as Gary Becker) use the notion of calcu-
