For the last couple of years, I’ve been working on alternative ways of understanding the economy. Although that work has focused on the digital economy, many of the principles that emerge from it may also apply much more widely. One part of the argument I’ve been developing (in a book called Profit and Gift in the Digital Economy, due to appear in 2016), is that conventional ways of understanding the economy – including critical approaches – are deeply flawed, and we need an alternative approach: a political economy of practices.
For mainstream economics, the economy is little more than a collection of markets, and the paradigmatic form of economic transfer is the sale/purchase of commodities ‘in the market’. Its practitioners rarely recognise other economic forms. (The major exception is state provision of goods, but this is often treated as little more than an obstacle to the economic efficiency that could be achieved if the state’s activities were transferred to the market.) Meanwhile critical approaches to the economy have long been dominated by Marxist political economy, which has a very different attitude to markets but largely shares the idea that our contemporary economy is overwhelmingly a commodity economy or market economy.
The literature on gift economies might seem to offer a promising alternative. It began as a critique of market fundamentalism, above all in the hands of Marcel Mauss, who almost a hundred years ago looked at the work of his fellow anthropologists and used it to argue that in ‘pre-modern’ societies economies operated largely without markets, and therefore that economies in general need not be run on a market basis. Instead, he said, these societies depended on cycles of gift-giving to distribute their products. There were strong normative obligations to give gifts, to receive them, and later to return something else of equivalent or greater value. The enormous influence of Mauss has led to scholars continuing to frame giving as universally governed by these obligations, and in particular the obligation to reciprocate.
As I have argued in a recent paper in the European Journal of Social Theory, one effect of Mauss’s dominance has been that many or most social scientists interested in giving have continued to identify it with the obligation to reciprocate, and often to insist that even contemporary giving always and necessarily entails reciprocity. Mary Douglas, for example, in her introduction to the English translation of Mauss’s book The Gift, insists that there can be no such thing as a ‘free gift’. No doubt reciprocity was crucial to the societies that Mauss was looking at, and of course some contemporary gifts are still reciprocated, but to insist that all gifts take this form is a massive error. Charitable giving, volunteering, bringing up our children, and the provision of a vast range of material for anyone to use on the Internet are just some of the examples of modern gifts that do NOT entail reciprocity. Bizarrely, some social scientists have sought to deal with this by extending the meaning of reciprocity in ways that bear no relation to either common usage or Mauss’s original intentions: these gifts are now labelled elements in a system of ‘generalized reciprocity’ where reciprocity comes to mean just that people who receive gifts also give other gifts to other people. But, as David Graeber points out in Debt: The First 5,000 Years (fn 21, p 405), this twists the word ‘reciprocity’ to the point of meaninglessness. If those further gifts are not given back to the original donor, this is not reciprocity! And if they do not arise from an obligation created by the original gift, this is not reciprocity!
Another side-effect of Mauss’s argument has been that scholars have often seen giving as a pre-modern alternative to the market, which becomes economically irrelevant once the market takes its place. Modern giving comes to be seen as a somewhat marginal activity – the exchange of birthday and other ritual presents, the odd coin tossed to a beggar – that occurs outside the economy rather than as part of it. And of course, this is also the natural consequence of thinking of the economy as being defined by the market relation.
But this market-centrism and the narrow view of the gift that it leads to must be rejected. Perhaps the most striking reason to reject it is the sheer diversity of existing economic activity. Of course, if one defines the economy as a market economy all other forms of economic activity become invisible, but a wide range of heterodox economists have argued instead that we should define the economy instead as provisioning activity: activity that meets people’s needs. Once we look at the economy in this way we begin to see that, for example, caring work in the household, subsistence agriculture, state provision of services, charity and volunteering for example are all part of the economy.
As the two feminist geographers writing as J.K. Gibson-Graham showed brilliantly in their book The End of Capitalism, these non-market forms of economy tend to be concealed by hegemonic discourses of the economy. The mainstream conception of the economy as a purely market form has become deeply ingrained in our consciousness, not least by the constant focus of media and politicians on notions of ‘Gross Domestic Product’. GDP measures only that which is exchanged in the market and by measuring the economy in this way we make growing market exchange the central focus of state policy towards the economy. Marxists, despite their generally critical stance, have tended to bolster this understanding of the nature of the economy by presenting the contemporary economy as thoroughly capitalist and capitalism as utterly based on the production of commodities for sale in the market by labour power purchased in the market.
Once we reject that discourse, we necessarily open up a range of questions that neither mainstream economics nor Marxist political economy has adequate answers to. Mainstream economics has no tools for analysing other forms of economy than the market, and although Marxists do recognise multiple modes of production, their analysis of the contemporary economy is equally focused on market forms and in particular on the extraction of surplus value from wage labour. But we need other kinds of explanation to make sense of economic activities that do not take a market form.
In Profit and Gift in the Digital Economy I argue that the solution to this problem is a political economy of practices: an analysis of each alternative form of economy as an interacting complex of economic practices. This not only allows us to start developing accounts of non-market and non-capitalist economic forms, but also to analyse the diversity of forms taken by capitalism itself. One of the striking features of the digital economy is that it includes both gift forms, like Wikipedia and peer to peer file sharing, and capitalist forms that work in very different ways from the canonical industrial form theorised by Marx, such as Google and Facebook. In future posts I will look at how we might begin to analyse some of these cases from the perspective of a political economy of practices.