Conceptualizing Social Justice: the contribution of Karl Polanyi

Please cite the paper as:
Maria Alejandra Madi, (2024), Conceptualizing Social Justice: the contribution of Karl Polanyi, World Economics Association (WEA) Conferences, No. 1 2024, Capitalism, Socialism and Democracy 80 years later, Looking at capitalism today in light of its past and possible future


In the 21st century, the systemic and institutional analysis proposed by Karl Polanyi is a decisive reference to apprehend the current cultural and social challenges to (re)embedding the economy in society. This historical setting favored shaped ethical and economic patterns that do not favor social justice. As a result of financial and trade globalization, the current driven-forces of institutional change and money commodification have fostered disruptive forces on livelihoods and disorganized solidarity and reciprocity interrelations. Indeed, the recent social and economic trends have expressed deep conflicts between the perspectives of sustainable economic growth and the society claims around decent work and income redistribution. Indeed, current economic modernization has fostered social inequality in the frame of the financial-led growth regime that privileges the centrality of the free markets.

The neo-liberal economic dynamics, founded on the laws of the self-regulated markets that favor efficiency and productivity, has been strengthening the reductionism of the concept of human being that is also present in the definition of individual in liberal thinking. It is in this environment that the promise of productivity gains crosses the line between the meaning of human being and the meaning of human existence. The demand for productivity, instead of serving the human purpose, closes on itself to become its own finality. Indeed, such rationality of productivity and efficiency results into unemployment, precarious work, social exclusion and impoverishment. In addition, resource exhaustion and the threats against the environment also show deleterious aspects of present-day forms of economic power.

Accordingly Karl Polanyi, a society is a living organism which ethos is the result of a complex combination of customs, norms, attitudes, aspirations that shape institutions. As a consequence of this, his understanding of social justice emphasises the fact that the economy must be backed by ethical ideals in order for it to work correctly and in order to safeguard society. The ethics in question is not any ethics at all, but rather an ethics that is centred on humans. It is imperative that the principle of social justice be based on the idea that the human person should be at the centre of ethical ideals.

Considering the relevance of Polanyi’s work to apprehend today’s challenging social and political issues, our aim is to provide a more deep and nuanced understanding of his thought on social justice. Section one examines Polanyi’s interpretation of modern economic and social history so as to clarify the ethical presuppositions present in his work. Section two addresses how his understanding of the relation between ethics and economics touches on social justice. Section three analyses the concept of social justice as part of Polanyi’s contribution to social philosophy. Finally, the conclusions highlight that Polanyi’s understanding of modern capitalism really favors a concept of social justice that is overwhelmed by the principles of reciprocity and solidarity.


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6 comment

  • Fernanda Caporale says:


    Your conclusions highlight that Polanyi’s understanding of modern capitalism really favors a concept of social justice that is overwhelmed by the principles of reciprocity and solidarity.

    Are you of the opinion that Schumpeter also developed a conception of social justice? What are the pillars, if the answer is yes?


    • Conference administrator says:

      Hello, Fernanda, I appreciate you asking such an intriguing question.

      According to my understanding, Joseph Schumpeter did not directly conceptualise the concept of social justice. On the other hand, it is essential to keep in mind that Schumpeter’s perspectives are intricate and multi-dimensional. Schumpeter did understand the fundamental contradictions that exist in modern capitalism, which are characterised by delegitimizing tendencies in the political and economic sectors that put in question democratic aspirations.

      Through his argument, he predicted that socialism would eventually supplant capitalism in West democratic societies . Despite the fact that Schumpeter did not directly address the issue of social justice, his perspectives on democracy and socialism imply that there is a connection between the two. A shift of social and political institutions is implied by his claim  towards socialism. This transition has the potential to lead to a more equitable allocation of resources, which is an essential component of providing social justice. This interpretation, on the other hand, is only an assumption.

      Maria Alejandra

  • Conference administrator says:

    from Germana

    Dear Maria,
    I read your paper too and I found it of particular interest to me. Actually, we deals with the same subject (how detrimental is the “culture of money”), even if using different arguments and references.

    Once we agree upon what you clearly say in your paper:
    The commodification of money may possible to enlarge the subordination of sociability conditions to the market economy and the social relations become an “accessory of the economic system” (Polanyi 1944:75)

    the question I would like to think about is: how we can overturn this direction.

    • Conference administrator says:

      Dear Germana, Thansk for your interesting question

      The work of Polanyi provides a critical prism through which to evaluate the interaction between markets and society, and his ideas continue to be inspiring in the present day.

      Accordin to Polanyi, labour, land, and money are not genuine commodities because they were not first generated for the purpose of being sold on markets. In an effort to reverse the trend towards commodification, Polanyi put out the concept of “embeddedness,” which posits that economic activity ought to be embedded inside social interactions rather than the other way around. Additionally, he proposed that in order for society to safeguard itself from the damaging effects of the market, it should engage in a “double movement” consisting of the protective countermovement that resists commodification.

      Here are some examples of how Polanyi’s concepts can be applied to think how to resist to the commodification trend:

      1. Implementing rules that govern markets and safeguard society from the adverse effects of commodification is the first step in the regulation and social protection process. This could include rules pertaining to labour, regulations pertaining to the environment, and social safety nets.

      2. Expanding cooperative economics, often known as social enterprises or cooperatives, are examples of economic isntitutions that put the welfare of society before of profit.

      3. Advocating for the de-commodification of labour, land, and money is a goal that may be accomplished through the protection of the environment, the implementation of acceptable wages, and the establishment of controls on financial speculation,

      4. Working towards a cultural shift that might enhance education and alterations to the current norms of society oriented to the motive value.

      It is important to keep in mind that these are broad ideas, and the implementation of them would be contingent on certain social conditions.

      Conversation that took place with Bing on March 21st, 2024
      The political and economic thought of Karl Polanyi is discussed in Chapter 7 of the book titled “Commodification.” Commodification can be found at the following link:
      (2) The antinomies of embeddedness and Karl Polanyi’s theory is discussed. University of Oxford:
      (3) The culture of false commodification, according to Karl Polanyi’s interpretation of the phenomenon…. This article can be found at
      (4) is not defined? 10.1017/9781788210911.008 is the citation for this article.
      five (5) not defined. Here is the link:

  • John Willoughby says:

    Thank you for this inspiring paper. There is a lot of psychological and behavioral economic research that validates Polanyi’s argument that humans are primarily interested in security and social standing. Angus Deaton has also recently written a book which calls for restrictions on commodification and subordinating the economy so that competitive dynamics do not destroy social bonds.

    • Conference administrator says:

      Hi John,

      Thanks for your inspiring comments.

      Karl Polanyi’s view of human behaviour is multidimensional and inextricably linked to his analysis of economic systems and societal dynamics. He claimed that economies are embedded in social connections, cultural norms, and institutions. Economic behaviour cannot be understood in isolation; since it is influenced by larger social settings. in this line of thought, the capitalist markets are not self-regulating systems, but rather social constructs.

      Polanyi criticised the 19th-century liberal ambition of building a disembedded economy through free markets. Instead, he argued for an economy that is embedded in social relationships, with behaviour directed by ethical considerations and community well-being. Polanyi aimed to balance personal freedom with social solidarity, and in his view, individual behaviour should be consistent with collective well-being and social cohesion. In summary, Polanyi’s attention on the critique of a disembedded economy emphasises the significance of understanding behaviour within larger social and cultural contexts.

      Certainly Angus Deaton also offers critical comments ont the importance of power in setting prices, salaries, and the direction of technological progress, and, as a result, understanding **inequality** and other features of modern capitalism is difficult without first analysing power dynamics. Moreover, Deaton emphasises that the current emphasis on individual well-being frequently overlooks the value of relationships within families and communities. However, many economists frequently associate well-being with money or consumption, overlooking other important aspects for individuals.

      I believe that Polanyi and Deaton’s works challenges us to reconsider economic assumptions, to rethink power dynamics, and to reintroduce ethics into economic thought. I can remark that, in their opinion, prioritising social bonds necessitates a shift in individual behaviours, social/institutional frameworks and economic paradigms.

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