Market Economy vs Capitalism

The distinction between market economy and capitalism is the operational core of Braudel's economic sociology. The market economy is the zone of transparent, locally embedded, competitive exchange — peasants at a weekly market, craftsmen with small workshops, merchants trading regionally in goods whose prices all participants can see. Capitalism is the zone above it: long-distance trade whose prices local participants cannot know, financial instruments that most people cannot access, monopolies shielded by state power or network effects, and concentrated accumulation that extracts from the market below rather than participating in it. Applied to AI, the developer in Lagos building with Claude operates in the market economy; Anthropic setting API prices operates at the capitalist layer; the two are structurally different zones even though they appear on the same screen.