Markets in the History of Political Economy

Most contemporary economists understand markets as purely price-making systems, ignoring the role of markets as relational systems that frame our way of life and determine the kind of society we live in. This book weaves both of these elements together to present a history of markets which accepts the interplay between price system and relational system and between mechanism and purpose. The book recounts the evolution of the narratives adopted by political economists to describe the workings of the market and how the market may serve to create and maintain relationships that foster cooperation and trust and improve welfare. Such a story of the market follows the debate among political economists, revealing a sense of mission to press the potential of markets into service to solve poverty and promote human welfare. Naturally, their ideas, dreams and ambitions changed with changing circumstances and understanding. Thomas Aquinas, Adam Smith and John Stuart Mill all had something different in mind when writing about the market. The book therefore presents different episodes in the history of political economists’ market, extending from the heyday of control (by religious, communal and feudal authorities in the Middle Ages) to the heyday of liberty during the mid-nineteenth century (laissez-faire). This history of political economists advancing their ideas about the place of markets in human life offers a much-needed complement to the more common one-sided representation of markets. This book will be essential reading for historians of economic thought and political economy who are interested in the evolution of ideas on the role of markets.

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