Economics need to change - now more than ever! With Exploring Economics, we strengthen alternative economic approaches and counter mainstream economics with a critical and pluralistic vision of economic education. We also provide background analyses on current economic debates to strengthen a critical economic discourse.
Unfortunately, we are running out of money to continue our work.
With a small contribution you can help Exploring Economics to stay online. Thank you!
We are a registered non-profit organization | Bank account: Netzwerk Plurale Ökonomik e.V., IBAN: DE91 4306 0967 6037 9737 00, SWIFT-BIC: GENODEM1GLS | Imprint
The Governance of Markets in Challenging Times: From Classic Authors to New Approaches
Hertie School of Governance, 2019
Exploring Economics for Teachers
Exploring Economics collects course descriptions, syllabi and slides so that lecturers can share resources and innovate their teaching.
Share your Syllabus Find more Teaching Material
The Governance of Markets in Challenging Times: From Classic Authors to New Approaches
This syllabus was originally taught at the Hertie School of Governance Summer Semester 2019.
Instructor: Lukas Graf
Course Summary
This course provides future change makers in public and private sectors with a comprehensive overview on the structures and actors that shape markets.
The socio‐economic divisions and tensions in today’s society seem to run deep and even the most stable market economies are struggling to find effective solutions. What are the driving forces of these developments? Can the social market economy survive? What are the proposed solutions? In the first part of the course, students will have the opportunity to debate key original texts from different disciplines (political science, sociology, economics, and history) central to the study of markets and their institutional set‐up. This includes classics (e.g., Smith, Marx), the liberal paradigm (e.g., Hayek, Friedman), economic sociology (e.g., Polanyi, Fligstein), but also new institutional economics, and historical approaches. These contending perspectives will enable students to contextualize more recent and alternative approaches. Thus, the second part of the course focuses on current propositions how to solve rising problems related to market governance, globalization, and neoliberalism. In this context, we will, for example, look at supranational market governance, solidarity economy and commons‐based approaches, degrowth and socio‐ecological transformation, gender perspectives in political economy, and postcolonial theories on the Global South. This course qualifies students to extrapolate insights from classic authors and newer approaches to reflect upon the governance of markets in challenging times. The students will acquire a thorough understanding of the fundamental elements of the governance of markets and learn to apply relevant theories and methods to real‐world policy problems. This includes the application of classical paradigms to contemporary policy challenges and debates. For further information on learning objectives, see course description.
Assignments and Assessment
Class Participation
All participants are expected to have completed all of the required readings before class and to have developed questions based on the texts, and to contribute to an active in‐class discussion.
Discussion Paper
You will write one discussion paper during the semester based on your interpretation of the required reading(s) for a specific session. You can discuss both required readings or choose one. Where useful, you can include the texts in the optional readings section or texts from other sessions in your discussion paper. Discussion papers (2,000 words +/‐ 10%, excluding bibliography) must be submitted to the instructor. Please follow these guidelines: Write your name, seminar title, date, and a title reflecting your position vis‐à‐vis the seminar reading in the document header. The first sentences will name the text(s) you are discussing and provide a theme. Next, please present a summary of the questions, hypotheses, key empirical points, and the argumentation of the text(s). Then, you will formulate your own perspective and several question(s) based on the reading(s), i.e. questions of understanding, content, and relationship to the overall seminar literature and discussion. Please also describe what you liked or learned and discuss any theoretical or methodological or other critique you may have. In the concluding outlook, please summarize what you think policy makers might learn from the text(s) about the governance of markets in challenging times. The discussion paper ends with a reference list in which you note the text(s) discussed and any supplementary literature or electronic sources you used.
Case Study
Students will work in small groups on a case study of their choice to present to the class. Please situate your case in the context of the overarching theme of the course (“The Governance of Markets in Challenging Times”). In addition, the presentation should provide clear linkages to the theme – and, if applicable, theory or method – discussed in the respective session during which the group will present. However, the case study should not just be a summary of the selected readings, but students are encouraged to find a topic of their interest and bring new perspectives to the class. Students are very welcome to choose cases that reach beyond the European or North American context. In combination with an engagement with the relevant theory and methods, in the case study presentation, policy relevant questions such as the following should be addressed: What is the problem? Who are the actors involved? What are the solutions proposed so far? What is your stance? How do you support it? And do you have policy recommendations? Every group member should actively participate in the presentation. The presentation should not exceed 15min and it will be followed by a discussion with the whole class. The group should prepare a plan to initiate and moderate this discussion (max. 15min) and how to interact with the class. Each group should hand in the draft slides of their presentation as well as a summary (600 words +/‐10%, excluding bibliography) of their case study. This summary should also include a short description of your plan for the discussion and group interaction that follows your presentation. It is sufficient if one of the team members submits the respective documents. The case study group should approach the instructor right after the end of the last session before your presentation session to receive a brief feedback on the draft presentation slides, the case study summary, and the planned group interaction – and to clarify any open questions prior to the actual presentation.
Research Paper
Your research paper should be informed by the readings we discuss throughout the semester and explicitly include several of the course readings. The research papers (3,500‐4,500 words excluding references) must develop a research question that is empirically informed and engage with at least one of the classical paradigms (Part I) or newer perspectives (Part II) to address the chosen question(s). The deadline for submitting papers (via the Moodle course page) is 21.05.2019. Please submit an abstract (250‐300 words excluding references) of your planned research paper.
Course Overview
Schedule of topics covered and mandatory readings
General Readings
- Barma, N. H. & Vogel, S. K. (Eds.) (2008) The Political Economy Reader ‐ Markets as Institutions, New York, Routledge.
- D'Alisa, G., Demaria, F., & Kallis, G. (2015) Degrowth: A Vocabulary for a New Era. New York, Routledge.
- Heywood, A. (2017) Political Ideologies ‐ An Introduction (6th edition), London, Macmillan
Session 1 The Classics – Smith, Marx
Content:
- We begin the course with the study of two classical political economy perspectives that represent opposing extremes. On the one hand, we look at Smith’s position that the state should ideally adopt a laissez‐faire policy with regard to markets. On the other hand, we explore Marx’s critique of capitalist markets as embodying power relations that lead to human alienation in the division of labour.
Literature:
- Adam Smith (2008 [1776]) An Inquiry into the Nature and Causes of the Wealth of Nations. IN Barma, N. H. & Vogel, S. K. (Eds.) The Political Economy Reader. Markets as Institutions. New York, Routledge, pp. 27‐40.
- Karl Marx and Friedrich Engels (1848) The Communist Manifesto. London: Bildungs‐Gesellschaft für Arbeiter.
Optional Literature:
- Friedrich List (1841) The National System of Political Economy.
- John Stuart Mill (1909) Principles of Political Economy. London: Longmans, Green.
- John Maynard Keynes (1936) The General Theory of Employment, Interest and Money. London: Macmillan.
Session 2 The Liberal Paradigm – Hayek, Friedman
Content:
- In this session, students analyse the liberal perspective on market governance. We discuss two free‐market theorists: Friedrich Hayek, whose work is linked to the traditions of the Austrian school of economics, and Milton Friedman, the most famous proponent of the liberal “Chicago school of economics”.
Literature:
- Friedrich A. Hayek (2008 [1944]) The Road to Serfdom. IN Barma, N. H. & Vogel, S. K. (Eds.) The Political Economy Reader. Markets as Institutions. New York, Routledge, pp. 91‐105.
- Milton Friedman (2008 [1962]) Capitalism and Freedom. IN Barma, N. H. & Vogel, S. K. (Eds.) The Political Economy Reader. Markets as Institutions. New York, Routledge, pp. 107‐120.
Optional Literature:
- Ludwig von Mises (1981 [1922]) Socialism: An Economic and Sociological Analysis. Indianapolis: Liberty Fund.
Session 3 Economic Sociology – Polanyi, Fligstein
Content:
- An important starting point for economic sociology is that markets are embedded in social relations. This implies that collective actors and social systems are key units of analysis – rather than methodological individualism. We will study both Karl Polanyi, who provides a counterpoint to the liberal school of thought, and Neil Fligstein’s work on the social structures of different sectoral markets and how they affect market behaviour.
Literature:
- Karl Polanyi (2008 [1944]) The Great Transformation: The Political and Economic Origins of Our Time. IN Barma, N. H. & Vogel, S. K. (Eds.) The Political Economy Reader. Markets as Institutions. New York, Routledge, pp. 121‐151.
- Fligstein, N. (2001) The Architecture of Markets, Princeton, Princeton University Press, pp. 27‐44.
Optional Literature:
- Dobbin, F. (1994) Forging Industrial Policy. The United States, Britain, and France in the Railway Age. New York: Cambridge University Press, pp. 1‐27 (Chapter 1).
- Granovetter, M. (1985) Economic Action and Social Structure: The Problem of Embeddedness. American Journal of Sociology 91 (1985): 481‐ 510.
- Powell, W. W. and DiMaggio, P. J. (Eds.) 1991 The New Institutionalism in Organizational Analysis. Chicago: Chicago University Press.
- Dobbin, F. (Ed.) (2004) The New Economic Sociology: A Reader. Princeton: Princeton University Press.
Session 4 (Lecture) The New Institutional Economics – North, Williamson
Content:
- New Institutional Economics shares some of the assumptions of neoclassical (liberal) economists on markets, such as rational utility maximization. However, students will discover that new intuitionalists stress the role of institutional patterns in the operation of markets, such as property rights or transaction costs regimes, and their path dependent evolution.
Literature:
- North, D. C. (1981) Structure and Change in Economic History, New York, W. W. Norton & Company, pp. 33‐44.
- Williamson, O. E. (1985) The Economic Institutions of Capitalism, New York, The Free Press, pp. 15‐23, 41‐42.
Optional Literature:
- Aoki, M. (2001) Toward a Comparative Institutional Analysis. Cambridge: MIT Press.
- Coase, R. (1937) The Nature of the Firm. Economica 4: 386‐405.
Session 5 Historical Perspectives – Gerschenkron, Hobsbawn
Content:
- The historical perspective on markets is richly descriptive and usually positions itself against monocausal explanations of market relations based on specific variables. In addition, students will explore why historians usually study long(er) historical periods to find explanations for the studied market phenomena.
Literature:
- Gerschenkron, A. (1961) Economic Backwardness in Historical Perspective, Chicago, The University of Chicago, pp. 5‐30.
- Hobsbawm, E. J. (1999[1968]) Industry and empire: from 1750 to the present day. New York, New Press; preface and introduction, pp. i‐xx.
Optional Literature:
- Rostow, W. W. (1960) The Stages of Economic Growth, Cambridge, Cambridge University Press.
- Landes, D. S. (1998) The Wealth and Poverty of Nations, New York, W. W. Norton & Company.
Session 6 Political Science and Political Economy – Lindblom, Hall
Content:
- A central joint interest of political scientists studying markets is the relationships of power among the relevant market actors. This is often linked to a focus on understanding the key role of state and business actors in shaping markets. We will also explore why this perspective is often fruitfully linked to the systematic comparison of different national economies.
Literature:
- Lindblom, C. E. (2008 [2001]) The Market System. IN Barma, N. H. & Vogel, S. K. (Eds.) The Political Economy Reader. Markets as Institutions. New York, Routledge, pp. 243‐258.
- Hall, P. A. (1986) Governing the economy: the politics of state intervention in Britain and France. New York, Oxford University Press; Chapter 1: Economic policy and the paradigms of politics (pp. 1‐22)
Optional Literature:
- Johnson, C. (1982) MITI and the Japanese Miracle, Palo Alto, Stanford University Press.
- Hall, P. A. & Soskice, D. (2001) An Introduction to Varieties of Capitalism. IN Hall, P. A. & Soskice, D. (Eds.) Varieties of Capitalism ‐ The Institutional Foundation of Comparative Advantage. New York, Oxford University Press, pp. 1‐68.
Session 7 Supranational market governance
Content:
- In this session, students study supranational market governance at the example of European integration project and its socio‐economic consequences. Drawing from the classic authors introduced before, we discuss whether European integration undermines market‐correcting capacities of European Union member states.
Literature:
- Scharpf, F. (2009) The asymmetry of European integration, or why the EU cannot be a ‘social market economy’, Socio‐Economic Review, 8, 211‐250.
- Zeitlin, J. & Vanhercke, B. (2018) Socializing the European Semester: EU social and economic policy co‐ordination in crisis and beyond, Journal of European Public Policy, 25:2, 149‐174.
Optional Literature:
- Hien, J. and Joerges, C. (eds. 2018) Responses of European Economic Cultures to Europe’s Crisis Politics: The Example of German‐Italian Discrepancies. Proceedings from the Villa Vigoni Conference. E‐Book. Robert Schumann Center, EUI, Florence.
- Habermas, J. (2015). The lure of technocracy. Cambridge: Polity Press. Hermann, C. (2017). Crisis, structural reform and the dismantling of the European Social Model(s). Economic and Industrial Democracy, 38(1), 51‐ 68.
- Maricut, A. and Puetter, U. (2018). Deciding on the European Semester: the European Council, the Council and the enduring asymmetry between economic and social policy issues. Journal of European Public Policy, 25(2), 193‐211.
- Seeliger, M. (2018). Why Do (Some) European Trade Unions Reject Minimum Wage Regulation? Culture, Practice & Europeanization, 3(1), 37‐ 46.
Session 8 Solidarity economy and commons‐based approaches
Content:
- Solidarity economy is an analytical lens on options to reform the capitalist market principle and to put the people first. Similarly, commons‐based approaches move beyond the discourse that markets are the best solution to organise social and economic relations.
Literature:
- Bollier, D. & Helfrich, S. (2012) Introduction: the commons as a transformative vision. IN Bollier, D. & Helfrich, S. (Eds.) The wealth of the commons. A world beyond market and state. Amherst, Levellers Press. http://www.wealthofthecommons.org/contents
- Kawano, E. (2018) Solidarity Economy: Building an Economy for People & Planet. Washington, D.C.: The Democracy Collaborative.
Optional Literature:
- Miller, E. (2009) Solidarity Economy: Key Concepts and Issues. IN Kawano, E., Masterson, T. N. & Teller‐Elsberg, J. (Eds.) Solidarity Economy I: Building Alternatives for People and Planet. Amherst, MA USA, Center for Popular Economics, 25‐41.
- Kawano, E. (2009) Crisis and Opportunity: The Emerging Solidarity Economy Movement. IN Kawano, E., Masterson, T. N. & Teller‐Elsberg, J. (Eds.) Solidarity Economy I: Building Alternatives for People and Planet. Amherst, MA USA, Center for Popular Economics, 11‐23.
- Ostrom, E. (1990) Governing the Commons: The Evolution of Institutions for Collective Action, Cambridge: Cambridge University Press.
- Ostrom, E. (2010). Beyond markets and states: polycentric governance of complex economic systems. American economic review, 100(3), 641‐72.
Session 9 Degrowth: a pluralist perspective on market‐driven growth
Content:
- Students will analyse and discuss degrowth as a pluralist school of thought centred on the democratically‐led shrinking of market production and consumption to enhance social and ecological sustainability.
Literature:
- D'Alisa, G., Demaria, F., & Kallis, G. (2015) Introduction: Degrowth. IN Kallis, G., Demaria, F. & D’Alisa, G. (Eds.). Degrowth: a vocabulary for a new era. New York, Routledge, pp. 1‐17.
- Muraca, B. (2013) Decroissance: A Project for a Radical Transformation of Society. Environmental Values, 22(2): 147‐169.
Optional Literature:
- Demaria, F., Schneider, F., Sekulova, F. & Martinez‐Alier, J. (2013) What is Degrowth? From an Activist Slogan to a Social Movement. Environmental Values, 22(2): 191‐215.
Session 10 The social‐ecological transformation perspective
Content:
- In this session, we contrast market‐conform green economy approaches to more transformative socio‐ecological perspectives. In this context, we also discuss why the social‐ecological transformation has not yet occurred – and what the obstacles are to policy change.
Literature:
- Brand, U. (2016) “Transformation” as a New Critical Orthodoxy. The Strategic Use of the Term “Transformation” Does Not Prevent Multiple Crises. GAIA ‐ Ecological Perspectives for Science and Society 25(1): 23–27.
- Fischer‐Kowalski, M. & Haas, W. (2016) Toward a Socioecological Concept of Human Labor. IN Haberl, H., Fischer‐Kowalski, M., Krausmann, F. & Winiwarter, V. (Eds.) Social Ecology. Society‐Nature Relations across Time and Space. Basel, Springer International Publishing, pp. 169‐196.
Optional Literature:
- Brand, U., & Wissen, M. (2015). Strategies of a Green Economy, contours of a Green Capitalism. In: Handbook of the international political economy of production. Edited by K. van der Pijl. Cheltenham, UK: Edward Elgar, pp. 508–523.
- OECD/Martinez‐Fernandez, C., Hinojosa, C., Miranda, G. (2010). Green jobs and skills: The local labour market implications of addressing climate change, Working document, CFE/LEED, OECD, www.oecd.org/dataoecd/54/43/44683169.pdf?contentId=44683170.
Session 11 Gender perspectives in political economy
Content:
- Gender perspectives in political economy ask how economics (including markets) influence gender relations and how gender relations influence the economy. Our focus today is on relations between gender and economic power. In addition, a key question we address is how dominant knowledge about economic processes is created and legitimated.
Literature:
- Çağlar, G. (2010) Multiple meanings of gender budgeting: gender knowledge and economic knowledge in the World Bank and UNDP. IN Young, B. & Scherrer, C. (Eds.) Gender Knowledge and Knowledge Networks in International Political Economy. Baden‐Baden, Nomos, 55‐74.
- Yeates, N. (2009). Production for export: the role of the state in the development and operation of global care chains. Population, Space and Place, 15(2), 175‐187.
Optional Literature:
- Elson, D. (1998) The economic, the political and the domestic: businesses, states and households in the organization of production, New Political Economy, 3(2), 189–208.
- Hartmann, H. I. (1979). The unhappy marriage of Marxism and feminism: Towards a more progressive union. Capital & Class, 3(2), 1‐33.
- Mellor, M. (1997). Feminism & ecology. New York: New York University Press.
- Picchio, A. (2003) A macroeconomic approach to an extended standard of living. IN Picchio, A. (Ed.) Unpaid Work and the Economy. A gender analysis of the standards of living. London, Routledge, 11‐28.
Session 12 Postcolonial theories and the Global South
Content:
- Postcolonial perspectives critically analyse traditional economic schools of thought. In this perspective, deviance from the Western “ideal” of market governance is not treated as a problem but rather as an opportunity to gain new insights. In this context, students will also debate Western “linear” perceptions of development or progress.
Literature:
- Pollard, J., McEwan, C. & Hughes, A. (2011) Introduction: Postcolonial Economic Lives. IN Pollard, J., McEwan, C. & Hughes, A. (Eds.) Postcolonial Economies. Chicago, The University of Chicago Press, pp. 1‐20.
- Ziai, A. (2017). ‘I am not a Post‐Developmentalist, but…’ The influence of Post‐Development on development studies. Third World Quarterly, 38(12), 2719‐2734.
Optional Literature:
- Manzano, M., Salas, C. & Santos, A. (2015) Brazil in the last 20 years: searching for a new accumulation regime. IN Gallas, A., Herr, H., Hoffer, F. & Scherrer, C. (Eds.) Combating Inequality. The Global North and South. London, Routledge, pp. 163‐179.
- Kohli, A. (2012) State‐Directed Development: Political Power and Industrialization in the Global Periphery, Cambridge, Cambridge University Press.
- Doner, R. F. (2009). The politics of uneven development: Thailand's economic growth in comparative perspective. Cambridge, Cambridge University Press.
- Kurtz, M. J. (2013). Latin American state building in comparative perspective: Social foundations of institutional order. Cambridge, Cambridge University Press.
- Reinert, E. S. (2008). How Rich Countries Got Rich‐‐and why Poor Countries Stay Poor. New Delhi: Anthem Press.
- Wade, R. (2004). Governing the market: Economic theory and the role of government in East Asian industrialization. Princeton, Princeton University Press.
Stay tuned!
Subscribe to our newsletter to learn about new debates, conferences and writing workshops.