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János Kornai's Critique of the Socialist System
New School for Social Research, 2020
In his presentation, Sanjay Reddy argues that the key quality of socialist economic systems according to János Kornai is their political nature. Reddy highlights three main concepts of Kornai: (1) the soft budget constraint, (2) the political economy of shortages and (3) investment hunger. However, only concepts (1) and (2) are actually discussed. Reddy also highlights some key critiques of Kornai's work. First, he argues that, while Kornai had a realistic view of existing socialist systems, his view of capitalism was idealised and neoclassical and so he did not truly engage in comparative analysis. Second, he raises the point that the 'soft budget constraint' critique of the socialist system can be extended to mixed or capitalist economies.
This presentation is part of a 28-session-long course from the New School for Social Research, called "Sociology and Socialism".
The full course is available to view for free online here.
Videos of the lectures are free online here.
Comment from our editors:
The lecture is advisable for everyone, who is interested in looking for structural alternatives to capitalism. Starting from reminding everyone that a materialist perspective has the ambition or hope to improve the actual realities of people's lives, he draws upon János Kornai's work as part of a more general quest to bring a 'dose of realism' to discussions about socialism. In this way, the lecture (and the very advisable discussion afterwards) teasers a variety of concepts and issues that help in critically examining historically existing forms of socialism. Although both Sanjay Reddy and the interviewer Andrew Arato see limitations in Kornai's work - e.g. that his crititique of capitalism is not up to the task or that he does not distuinguish enough between different varieties of really existing socialism - they agree that his work can help to understand dysfunctionalities that might come along with forms of socialism.