"Braudel on capitalism and the market."

Following on August 13's "Capitalism And The Market Economy Are Completely Opposite Intellectual Paradigms".

From Monthly Review via The Free Library: 

A note from our friend Immanuel Wallerstein, dated October 28, reads as follows: "Last week I participated in a three-day colloquium in France on the work of Fernand Braudel. On the day devoted to 'Capitalism' I gave a short paper. It proved to be very provocative. The French version will eventually appear in some tome. Since it is short and in the MR style, I thought you might find the attached English version something that would get enough backs up (in a comradely way) to stimulate discussion and merit publication in MR."

We agree, and publication of Wallerstein's paper is all the more appropriate at this time because on November 28, hardly more than a month after the Paris colloquium, Braudel, without doubt the most eminent of contemporary French historians, died in Paris at the age of 83. Braudel was long associated with--and at the time of his death was the leading figure in--the Annales school of French historiography, which had its origins after the First World War among a distinguished group of French scholars, including Marc Bloch and Luden Febvre. Braudel's major works were The Mediterranean and the Mediterranean World in the Age of Philip II (1949) and Civilization and Capitalism, 15th-18th Century (1979). The former was published in English translation (two volumes) in the mid-1970s, the latter (three volumes) in the early 1980s. Immanuel Wallerstein is the founder and head of the Fernand Braudel Center for the Study of Economics, Historical Systems, and Civilizations at the State University of New York, Binghamton.--The Editors 

Forty years ago the role of the market in capitalism seemed quite straightforward. The market was thought to be a defining feature of capitalism, not only because it was a key element in its operation but because it distinguished capitalism from the two antitheses to which it was usually compared: on the one hand, from feudalism which preceded it; and on the other hand, from socialism which was supposed to come after it. Normally one presented feudalism as a pre-market system and socialism as a post-market one.

Today it is no longer possible to use such a schema as the basis of analysis. This is not because this schema is simplistic; rather, the schema is unquestionably false, for at least three reasons.

First of all, research on feudal society, considerably advanced since 1945, makes it quite clear that it is not possible to think of it as a closed system living on subsistence farming within a so-called natural economy. In reality, markets existed everywhere and were deeply enmeshed in the logic of the operation of this historical system. To be sure, there were many differences between it and a capitalist system. Commodification was limited, and the markets were usually either quite local or longdistance, but seldom "regional." The long-distance trade was primarily a trade in luxury goods. Nonetheless, the contrast with what developed later under capitalism has become increasingly blurred as we have come to study the realities of feudal society more closely. 

In the same way, really-existing socialism has seemed to show a tendency to develop the market, in two ways. First of all, analysts are more and more in agreement that it is simply not true that the so-called socialist/Communist countries have truly and definitively withdrawn from the world market. Secondly, at the national level, practically every country in the socialist camp has been the scene of a long internal debate about the virtues of some liberalization of the internal market. There is even a new concept these days, "market socialism."

Thus the reality of feudalism and the reality of socialism have contradicted the old theoretical schema. But it is also true that capitalist reality contradicts it as well. And here Braudel's work has been of central importance in understanding this. The central point of his recent trilogy * is to discern three parts to capitalist reality, and to argue that the word "market" should be used to designate only one of these parts, the stratum between "everyday life" at the bottom and "capitalism" at the top. In particular Braudel wishes to reformulate the relation between the market and monopolies. Normally one thinks of competition and monopoly as two poles of the capitalist market, which in some way alternates between them. Braudel sees them rather as two structures in perpetual struggle with each other, and of the two, he wants to use "capitalist" as the label only of the monopolies. 

By doing this, he turns the intellectual debate upside down. Rather than thinking of the free market as the key element in historical capitalism, he sees monopolies as being the key element. Monopolies dominating the market are the defining element of our system and it is this that distinguishes capitalism quite clearly from feudal society--and perhaps as well from an eventual world socialist system, one that has been insufficiently noticed up to now.

Adam Smith and Karl Marx agreed on certain things. One of the most fundamental of their common views was to consider that competition is what is normal in capitalism--normal ideologically and normal statistically. Consequently, monopoly is exceptional. Monopoly had to be explained, and to be fought against. This ideology is still deeply rooted in the views of people today, not only in the general public but among social scientists.

However, it is not true that monopoly is statistically rare....

....MUCH MORE 

If interested see also:

Climateer Line Of The Day: Truth-Telling In Academia (follow-up to Capitalism And The Market Economy Are Completely Opposite Intellectual Paradigms)