Karl Polanyi: a theorist of mixed economies

Abstract

Karl Polanyi’s scholarship is interpreted in radically different ways. The “hard” reading of Polanyi sees him as a radical socialist; the “soft” reading presents him as a theorist of mixed economy. This article sides with the soft interpretation. It uses Polanyi’s biography to explain his theoretical “elusiveness,” presents a novel interpretation of his three types of economic integration, claiming all economies are “mixed.” While it acknowledges Polanyi as one of the major sources of world system theory, it claims that Polanyi saw not only the dangers, but also the necessity and positive consequences of globalization. Finally, it shows that, in spite of Polanyi’s life-long commitment to the political left, his scholarly work did not offer an apology of socialism. Instead this article uses Polanyi’s theory of economic integration to build a critical political economy of state socialism.