Market and Society: How Do They Relate, and Contribute to Welfare?

20 Pages Posted: 21 Dec 2004

See all articles by W. Dolfsma

W. Dolfsma

University of Groningen School of Economics and Business

J. Finch

University of Aberdeen - Business School

Robert McMaster

University of Aberdeen - Business School

Date Written: 14 2004, 12

Abstract

This paper discusses how markets and society relate to each other. We present and discuss three views: markets as separate, markets as embedded, and markets as impure. One’s stance on the contribution of markets to welfare hinges on the conceptualization of market and other spheres in society. If, for instance, one perceives of the economy (the economic domain) as an all-encompassing sphere or as a sphere totally separate from others, then one would believe markets necessarily contribute to welfare. Markets are presumed to be ubiquitous in mainstream economics; the orthodox view is that of the ‘market as separate’. Indeed, Frank Hahn notably conceded that neoclassical economics does not describe markets, but ‘conjures’ them up. Mainstream conceptions of the market are functionalist – in the appropriate conditions the market is an efficiency conduit, and hence wealth and welfare generating. Creating these appropriate conditions then drives policy, such as the provision of health care, and tends to produce a one size fits all approach. This paper argues that this is an overly restrictive conceptualization of markets, and is an inadequate basis for conceptualizing the potential effects of markets. Conceptualizing the market as impure and embedded must be added. We contribute to this discussion by developing the concepts of ‘boundaries’ separating spheres. Such an approach broadens the notion of welfare and well-being beyond the monetized parameters of economic orthodoxy.

Keywords: market, society, market as separate, markets as impure, markets as embedded, health care

JEL Classification: M, M13, A13, O32, A14

Suggested Citation

Dolfsma, Wilfred and Finch, J. and McMaster, Robert, Market and Society: How Do They Relate, and Contribute to Welfare? (14 2004, 12). Available at SSRN: https://ssrn.com/abstract=636816

Wilfred Dolfsma (Contact Author)

University of Groningen School of Economics and Business ( email )

P.O. Box 800
9700 AH Groningen, Groningen 9700 AV
Netherlands

J. Finch

University of Aberdeen - Business School ( email )

Edward Wright Building
Dunbar Street
Old Aberdeen AB24 3QY, Scotland AB24 3QY
United Kingdom

Robert McMaster

University of Aberdeen - Business School ( email )

Edward Wright Building
Dunbar Street
Old Aberdeen AB24 3QY, Scotland AB24 3QY
United Kingdom

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