Marketization: Theoretical Reflections Building on the Perspectives of Polanyi and Habermas

Abstract

The concept of marketization denotes the expansion of market coordination into non-market coordinated social domains as well as its intensification in already market-dominated settings. This article sets out to reconstruct an institutionalist theory of marketization. As a point of departure, it critically examines the related contributions of Karl Polanyi and Jürgen Habermas. The analytical strength of Polanyi's theory of marketization lies in the discussion of the contested embeddedness of markets and the view of marketization as a politically shaped process of institutional change. This concern with the societal expansion of markets is further developed in the Habermasian thesis of the ‘colonisation of the lifeworld’. However, both Polanyi and Habermas lack a specification of the social substance of markets and thus tend to underestimate the complexity of marketization. To address this issue, the present article utilizes the concept of collective goods to introduce new arguments about the institutional dynamics of marketization in the diverse fields of society.