CONCEPT
The Great Transformation
Polanyi's term for the political construction — not the natural emergence — of the self-regulating market in nineteenth-century Europe, and the catastrophic destruction it produced by subordinating social life to economic logic.
The great transformation was the process by which European societies, beginning in England in the late eighteenth century, attempted to construct a self-regulating market that would govern the production and distribution of goods — including the fictitious commodities of labor, land, and money — without interference from social institutions. Polanyi's central historical claim is that this was not a natural evolution but a deliberate political construction, accomplished through state action: enclosure legislation that converted common land into private property, Poor Law reforms that forced the displaced into the labor market, repeal of the Corn Laws that subjected agriculture to international price competition, and an intellectual revolution that elevated market logic to the status of natural law. The transformation inverted the historical norm of the embedded economy — subordinating society to the economy rather than the reverse — and produced destruction so severe that it provoked the protective counter-movements of the next century and, eventually, the catastrophes of the twentieth.
