The Center for Engaged Scholarship Wins Foundation Grant
The Center for Engaged Scholarship is pleased to announce that it has received a grant from the Hewlett Foundation. Specifically, the support is from a Hewlett project called “Beyond Neoliberalism: New Ideas for Economics and Political Economy.” From the start, our Center has prioritized the critique of neoliberal ideas since they have played such an important role in the rightward shift of U.S. society and politics.
Our proposal to Hewlett argues that our society’s movement “beyond the commodity” could be the foundation for a more powerful critique of free market ideas. Mainstream economics is built around the analysis of commodities that are defined as standardized products produced by multiple firms and transferred to purchasers at one moment in time. The standardized nature of commodities is centrally important for the claim that ongoing changes in prices will bring supply and demand for any given product into balance.
For many decades, this was an intuitively obvious way to understand the economy because industrialization facilitated the mass production of many products that had previously been hand crafted by artisans. Starting with textiles and shoes, this process was extended to rifles, bicycles, and ultimately automobiles, appliances, and other home furnishings. However, in the 21st century, fewer and fewer things that we purchase are standardized in this way. Services such as child care, education, and health care are supposed to be tailored to the particular needs of the individual client. At the same time, many of the manufactured goods that we purchase—cars, computers, appliances, cell phones, and television sets—involve extended service contracts and interoperability with other systems.
In fact, it is now Business 101 to tell entrepreneurs and managers that if they are producing commodities, they should stop. When you are producing commodities, you are at risk of being undersold by someone, often overseas, who can make the same product for less. Contemporary business strategy focuses on providing the customer with a unique good or service with the goal of locking the individual into a sustained customer relationship. This is the context in which firms have invested heavily in data mining to retain customers and to sell them additional products.
But here is the rub. When people are purchasing standardized items, sellers have little power over purchasers. Think of the local farmer’s market where tomatoes or cucumbers are available at five different stands. If your favorite stand has raised its prices or has uglier produce, you can go to a different one. But in the world of nonstandard products where there is often a continuing relationship between buyer and seller, power relations are very much present.
We see this with hospital bills, prescription medicines, tuition at colleges and universities, the charges from our cable provider, the behavior of large financial institutions, and, of course, the problematic privacy policies of Facebook, Google, and other technology firms.
In short, the theorists of the free market such as Friedrich Hayek and Milton Friedman told us that the enemy of human freedom was the arbitrary authority of governments. They insisted that if we relied on markets and kept government to a minimum, we would be truly free. But they built their theoretical edifice on the assumption that most of what was being bought and sold on the market were standardized commodities. They failed to anticipate the power differentials that emerge in an economy that has moved beyond standardized products.
There are, of course, already many powerful critiques of free market ideology including an environmental critique, a feminist critique, a racial critique, a financial instability critique, a monopoly power critique, and an inequality critique. Each of these critiques has validity, but we think the post-commodity argument has the potential to weld these different critiques together into a synthesis that would be more powerful and more politically potent.
Our plan is to bring together scholars to shape a research agenda around this idea of a post-commodity economy. If we are successful, then graduate students in the social sciences might shape their dissertation projects to fit this agenda creating synergy between our fellowship program and this project. We will post periodic reports and papers from this project, so watch this space.