Great Transformations: Economic Ideas and Institutional Change in the Twentieth Century

In this remarkably rigorous, original, and enlightening book Great Transformations: Economic Ideas and Institutional Change in the Twentieth Century Mark Blyth (Brown University) argues that economic ideas are powerful tools as used by actors and groups to effect change since whoever defines what the economy is, what is wrong with it, and what would improve it, has a profound political resource in their possession. Blyth analyzes the 1930s and 1970s, two periods of deep-seated institutional change that characterized the twentieth century. Viewing both periods of change as part of the same dynamic, Blyth argues that the 1930s labor reacted against the exigencies of the market and demanded state action to mitigate the market’s effects by “embedding liberalism” and the 1970s, those who benefited least from such “embedding” institutions, namely business, reacted against these constraints and sought to overturn that institutional order. In Great Transformations, Blyth demonstrates the critical role economic ideas played in making institutional change possible and he rethinks the relationship between uncertainty, ideas, and interests on how, and under what conditions, institutional change takes place.
This is an extraordinary, meticulously researched book, which is regarded by many as a worthy successor to Karl Polanyi’s seminal work.