The Dictionary of Human Geography

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production and the centralization of capitalist

control under the figure of the capitalist-

entrepreneur. These claims – to the extent that

they reflect some common ground – are sub-

sequently elaborated in radically different

ways. Some cling to a narrow definition of

economy (theorized in different ways) as

central to the intellectual enterprise; others

seek to link economy,culture, politics and

societyinto a more elaborated sense – what

Max Weber called a ‘cosmos’ – of a capitalist

system. In general, the development and

institutionalization of the critical social sci-

ences has seen a massive proliferation of

opinion – and of conceptual apparatuses – for

the examination of actually existing capitalist

systems.

Some of this diversity of opinion can be

appreciated by a consideration of a quartet of

theorists. Adam Smith, like other classical

political economists, was concerned with the

distribution and accumulation of economic

surplus and the problems of wage, price and

employment determination. Writing at the

birth of industrial manufacture, the key to

theWealth of nations(see Smith, 2003) is the

concept of an autonomous self-regulating

market economy described ascivil society.

Smith’s genius was to have seen the possibility

of an autonomous civil society, its capacity for

self-regulation if left unhindered and its cap-

acity for maximizing welfare independent of

state action. Smith located capitalism at the

intersection of thedivision of labourand

the growth of markets. Furthermore, in this

system self-interested individuals indirectly

and inadvertently promoted collective interest

through the functions of self-regulating mar-

kets. The growth of commerce and the growth

of liberty reinforce one another under capital-

ism. In its neo-classical variant, labour mar-

kets are seen as no different than any

commodity market and capitalist markets are

assumed, if unimpeded by the state or other

distortions, to function to produce a general

equilibrium. Friedrich von Hayek’s (1944)

account of liberal capitalism took this reason-

ing to its limit. Capitalism was conceived of as

a unity of liberty, science and the spontaneous

orders that co-evolved to form modern society

(the ‘Great Society’, as he termed it). It is a

defence of the liberal (unplanned) market

order from which the preconditions of civiliza-

tion – competition and experimentation – had

emerged. Hayek, like Weber, saw this modern

world as an iron cage constituted by imperson-

ality, a loss of community, individualism and

personal responsibility. But, contra Weber,

these structures, properly understood, were

the very expressions of liberty. From the

vantage point of the 1940s this (classical) lib-

eral project was, as Hayek saw it, under threat.

Indeed, what passed for liberal capitalism was

a travesty, a distorted body of ideas warped by

constructivist rationalism, as opposed to what

he called ‘evolutionary rationalism’. Milton

Friedman (2002 [1962]), in the realm of eco-

nomic theory, waged this battle from the

1960s onwards.

For Max Weber, the capitalist cosmos was

guided by systems of calculability and ration-

ality – this is what gave Western capitalism its

specificity – which grew in part as an unin-

tended consequence of Protestantism (see

Weber, 2001 [1904–5]). Formal rationality

produced a capitalist society characterized by

large-scale industrial production, centralized

bureaucratic administration and the ‘iron

cage’ of capitalism that shapes individuals’

lives with ‘irresistible force’.ContraSmith’s

roseate vision of capitalism – though always

wary of the costs of class oppression, in his

view dished out by corrupt government –

Weber’s vision of capitalism was ultimately

bleak, always operating in the shadow of the

‘totally administered society’.

Karl Polanyi was a Hungarian economic

historian and socialist, who believed that the

nineteenth-century liberal capitalist order had

died, never to be revived (see Polanyi, 2001

[1944]). By 1940, every vestige of the inter-

national liberal order had disappeared, the

product of the necessary adoption of measures

designed to hold off the ravages of the self-

regulating market; that is, ‘market despotism’.

It was the conflict between the market and the

elementary requirements of an organized

social life that made some form of collectivism

or planning inevitable. The liberal market

order was,contraHayek, not ‘spontaneous’

but a planned development, and its demise

was the product of the market order itself. A

market order could just as well produce the

freedom to exploit as the freedom to associate.

The grave danger, in Polanyi’s view, was that

liberal utopianism might return in the idea of

freedom as nothing more than the advocacy of

free enterprise, in which planning is ‘the denial

of freedom’, and the justice and liberty offered

by regulation or control just ‘a camouflage of

slavery’. liberalism on this account will

always degenerate, ultimately compromised

by an authoritarianism that will be invoked as

a counterweight to the threat of massdemoc-

racy. Modern capitalism, he said, contained

the famous ‘double-movement’ in which

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CAPITALISM