===================== HES POSTING ==================== Polanyi's 'Great Transformation' (1944) might still be an interesting book to read but I do agree with Michael Lynch that Polanyi's thesis is outdated. Especially Polanyi's classification of 'pre-industrial, non-market economies' developed in his 'Trade and Market in the Early Empires' (1957) might serve as a theoretical concept but it has no historical validity since all these concepts always existed at the same time - and still do today. In this respect there was no structural break during the 'industrial revolution'. Market transactions are rather an important feature of cultural continuity. I do not agree with Michael Perelman that it is just a question of 'what percentage prices penetrated the economy' or 'if the majority of the economy was a cash-price economy'. The problem already starts with the meanings of these terms: the 'market' itself is a concept with several dimensions, it can mean (like its latin root 'mercatus' indicates) either a place where exchange takes place or a method of exchange, while there are again several conditions of exchange (perfect competition, monopoly, etc.). When talking about a 'cash-price economy' we have to keep in mind that grain itself was widely used as 'cash' in ancient times while the role of silver as a currency even before coinage can not be denied. Concepts like Polany's 'politically administered trade' misses the fact that most ancient governments made use of private contractors. There is no doubt that markets as a method of exchange did exist since ancient times. That they also played an important role in ancient economies and societies as a whole can already be seen by the effort that legal history devoted at market- and especially price-regulations. If market forces would have been absent there would have been absolutely no need for regulation! The fact that those regulations usually failed to produce the desired results can serve as further evidence for the existence of market forces. In my own research on ancient literature I have found a lot of evidence on awareness of the importance of market transactions and even quite some understanding of the benefits of competitive markets and competitive prices. A very interesting book with an enormous amount of evidence for a market system already in ancient mesopotamia is MARC VAN MIEROOP, Society and enterprise in old Babylonian Ur (1992). Am interesting article about the question of market behavior in ancient times is MARVIN A. POWELL, Sumerian merchants and the problem of profit, in: Iraq, Vol.39, Spring 1977. ************************************** Thomas Moser Center for Research of Economic Activity (KOF) Swiss Federal Institute of Technology Zurich (ETH) e-mail: [log in to unmask] homepage: http://www.kof.ethz.ch/tm.htm *************************************** ============ FOOTER TO HES POSTING ============ For information, send the message "info HES" to [log in to unmask]