In a capitalist system, consumers, investors, and corporations orient their activities toward a future that contains opportunities and risks. How actors assess uncertainty is a problem that economists have tried to solve through general equilibrium and rational expectations theory. Powerful as these analytical tools are, they underestimate the future’s unknowability by assuming that markets, in the aggregate, correctly forecast what is to come.
Jens Beckert adds a new chapter to the theory of capitalism by demonstrating how fictional expectations drive modern economies—or throw them into crisis when the imagined futures fail to materialize. Collectively held images of how the future will unfold are critical because they free economic actors from paralyzing doubt, enabling them to commit resources and coordinate decisions even if those expectations prove inaccurate. Beckert distinguishes fictional expectations from performativity theory, which holds that predictions tend to become self-fulfilling prophecies. Economic forecasts are important not because they produce the futures they envision but because they create the expectations that generate economic activity in the first place. Actors pursue money, investments, innovations, and consumption only if they believe the objects obtained through market exchanges will retain value. We accept money because we believe in its future purchasing power. We accept the risk of capital investments and innovation because we expect profit. And we purchase consumer goods based on dreams of satisfaction.
As Imagined Futures shows, those who ignore the role of real uncertainty and fictional expectations in market dynamics misunderstand the nature of capitalism.
After the 1925 discovery of diamonds in the semi-desert of the northwest coast of South Africa, De Beers Consolidated Mines Ltd. virtually proclaimed its dominion over the whole region. In the town of Kleinzee, the company owns all the real estate and infrastructure, and controls and administers both the town and the industry.
Peter Carstens’s In the Company of Diamonds draws a stark and startling portrait of this closed community, one that analyzes the power and hegemonic techniques used to acquire that power and maintain it.
As a prototypical company town, Kleinzee is subordinated to the industry and will of the owners. Employees and workers are variously differentiated and ordered according to occupation, ethnic variation, and other social criteria, a pattern reflected most markedly in the allocation of housing. Managers live in large, ranch-style houses, while contract workers are lodged in single-sex compounds.
As a community type, company towns like Kleinzee are not entirely unique, and Professor Carstens successfully draws a number of structural parallels with other closed and incomplete social formations such as Indian reservations, military bases, colleges, prisons, and mental hospitals.
In the Shadows of State and Capital tells the story of how Ecuadorian peasants gained, and then lost, control of the banana industry. Providing an ethnographic history of the emergence of subcontracting within Latin American agriculture and of the central role played by class conflict in this process, Steve Striffler looks at the quintessential form of twentieth-century U.S. imperialism in the region—the banana industry and, in particular, the United Fruit Company (Chiquita). He argues that, even within this highly stratified industry, popular struggle has contributed greatly to processes of capitalist transformation and historical change.
Striffler traces the entrance of United Fruit into Ecuador during the 1930s, its worker-induced departure in the 1960s, the troubled process through which contract farming emerged during the last half of the twentieth century, and the continuing struggles of those involved. To explore the influence of both peasant activism and state power on the withdrawal of multinational corporations from banana production, Striffler draws on state and popular archives, United Fruit documents, and extensive oral testimony from workers, peasants, political activists, plantation owners, United Fruit administrators, and state bureaucrats. Through an innovative melding of history and anthropology, he demonstrates that, although peasant-workers helped dismantle the foreign-owned plantation, they were unable to determine the broad contours through which the subsequent system of production—contract farming—emerged and transformed agrarian landscapes throughout Latin America.
By revealing the banana industry’s impact on processes of state formation in Latin America, In the Shadows of State and Capital will interest historians, anthropologists, and political scientists, as well as scholars of globalization and agrarian studies.
This illuminating study of the evolution of Chinese capitalism chronicles the fortunes of the Song family of North China under five successive authoritarian governments. Headed initially by Song Chuandian, who became rich by exporting hairnets to Europe and America in the early twentieth century, the family built a thriving business against long odds of rural poverty and political chaos.
A savvy political operator, Song Chuandian prospered and kept local warlords at bay, but his career ended badly when he fell afoul of the new Nationalist government. His son Song Feiqing—inspired by the reformist currents of the May Fourth Movement—developed a utopian capitalist vision that industry would redeem China from foreign imperialism and cultural backwardness. He founded the Dongya Corporation in 1932 to manufacture wool knitting yarn and for two decades steered the company through a constantly changing political landscape—the Nationalists, then Japanese occupiers, then the Nationalists again, and finally Chinese Communists. Increasingly hostile governments, combined with inflation, foreign competition, and a restless labor force, thwarted his ambition to create an “Industrial Eden.”
Brett Sheehan shows how the Song family engaged in eclectic business practices that bore the imprint of both foreign and traditional Chinese influences. Businesspeople came to expect much from increasingly intrusive states, but the position of private capitalists remained tenuous no matter which government was in control. Although private business in China was closely linked to the state, it was neither a handmaiden to authoritarianism nor a natural ally of democracy.
Inequality, per se, has been with us for millennia. With the creation, growth and deepening of Capitalism across the globe, inequalities take on new dimensions, unknown in previous eras. As Capitalism has spread its wings across the globe over the last 200 or so years, so inequalities have deepened and widened, both inside Nation Sates, between nation States. These inequalities are of income, wealth and of power.
This book, written by the widely respected economic historian Douglas Dowd at the age of 90, is notable for his own experience and vivid memory, of the 1929-31 recession. Since the 1980s, and the predominance of the present neo-liberal ideology, all of the inequalities that the book presents have grown rapidly. Written as a critique of the counter-productivity of growing economic inequality and vindicated by the present world banking crisis, Dowd presents a strong argument against capitalist expansion, exploitation and oligarchic rule.
Dowd's conclusions, that the globalization and growth of the financial sector will impact painfully upon hundreds of millions of people, unknown to most of us in our lifetime, Dowd's book deals with these issues from the unique perspective of inequality. Presenting both a history of the current crisis and an overview of it's, Inequality will appeal to both a broad general readership, and provides an extremely useful reference point for students of political economy, economic history, contemporary economics and global politics.
After communism collapsed in the former Soviet Union, capitalism seemed to many observers like the only game in town, and questioning it became taboo for academic economists. But the financial crisis, chronic unemployment, and the inexorable rise of inequality have resurrected the question of whether there is a feasible and desirable alternative to capitalism. Against this backdrop of growing disenchantment, Giacomo Corneo presents a refreshingly antidogmatic review of economic systems, taking as his launching point a fictional argument between a daughter indignant about economic injustice and her father, a professor of economics.
Is Capitalism Obsolete? begins when the daughter’s angry complaints prompt her father to reply that capitalism cannot responsibly be abolished without an alternative in mind. He invites her on a tour of tried and proposed economic systems in which production and consumption obey noncapitalistic rules. These range from Plato’s Republic to diverse modern models, including anarchic communism, central planning, and a stakeholder society. Some of these alternatives have considerable strengths. But daunting problems arise when the basic institutions of capitalism—markets and private property—are suppressed. Ultimately, the father argues, all serious counterproposals to capitalism fail to pass the test of economic feasibility. Then the story takes an unexpected turn. Father and daughter jointly come up with a proposal to gradually transform the current economic system so as to share prosperity and foster democratic participation.
An exceptional combination of creativity and rigor, Is Capitalism Obsolete? is a sorely needed work about one of the core questions of our times.
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