Home > Uncategorized > Markets are not our only social space… Model that!

Markets are not our only social space… Model that!

I love markets. But I’m not a market fundamentalist. Non-market organisations or institutions, like unions, often do, in their social space, a better job than market organisations do in the market space. Despite this these non-market organisations are only marginally included in economic models, if at all, and neglected in neoliberal policies. Or: neglected? Neoliberal policies often lead to the destruction of at least part of the ‘social space’ of these ‘NPISH’, or Non Profit Institutions Serving Households’ as statisticians call them. As these organisations, though neglected by economic models, are routinely measured by economic statisticians. Which leads to the question: why are they neglected in the models when we do have the data? To enable policies which, consequently, also neglect the consequences of for instance austerity on these NPISH and what they do?

Anyway, we do measure them. Which is one step. What kind of organisations are included in this concept? (By the way: ‘not for profits’ or ‘non-profits’ is a pretty biased phrase.)

From the British ONS:

  • Charities, relief and aid organisations financed by voluntary transfers in cash or in kind from other institutional units
  • Universities
  • Further Education Colleges (classification decision awaiting implementation – see section 3.7)
  • Trade Unions
  • Political Parties
  • Professional or learned societies
  • Consumers’ associations
  • Churches or religious societies
  • Social, cultural, recreational and sports clubs

If we also think of households themselves, it quickly becomes clear that the time spent by people in non-market social spaces is quite a bit larger than the time spent in the market space…


  1. March 3, 2016 at 10:11 am

    There are also two completely different concepts of market: A place for connecting goods with needs, like a bazaar. Or a mechanism for regulating price, like a commodity exchange. These are not the same thing. Arguably the “invisible hand” works its magic by connecting existing goods to unexpected needs, not so much by discovering a clearing price which a visible bureaucrat could do.

  2. davidmbrichardson
    March 3, 2016 at 10:48 am

    Is there also a trend for many of these “non-profit” organisations to become “marketised” willy-nilly – often negatively affecting their originally intended function?

  3. March 3, 2016 at 7:46 pm

    Quote, “…the time spent by people in non-market social spaces is quite a bit larger than the time spent in the market space…”

    I’ll say, and not just tome spent at our DIY projects and other household activities from work to entertainment, but even when we are sleeping in our own beds rater than a motel bed. Good grief it seems I am not much of a market participant. – good on me =: -)

  4. March 3, 2016 at 10:43 pm

    Nice to see the list. good writing. Thank you.

  5. March 4, 2016 at 6:30 am

    Douglas North observed more than 30 years ago, “It is a peculiar fact that the literature on economics … contains so little discussion of the central institution that underlies neoclassical
    economics-the market.” In fact economists who favor free markets hardly ever tell you what they believe a market to be. But let’s assume along with Callon that a market is both an abstraction representing the process through which supply and demand confront one another and reach a compromise as to quantity and prices, and, at the same time the place (location) where the exchange occurs. A “free” market is then just both of these in which there is little or no regulation by government, or little oversight of any sort. As Polanyi pointed out almost a century ago organizing markets is difficult, and keeping them functioning is even more difficult. Who the hell can you trust, how far, and for how long? Failure is a usual, very usual occurrence for markets. In theory there is no tradition, custom, family restraints, or obligations to others outside the market that restrict how market participants act. Plus markets often go off in unexpected directions and cause harm in ways and for people or places that was not intended or expected. All and all not a reliable or efficient way to meet demand with supply at a price all participants can accept. In addition there are frequent opportunities in markets (particularly the free ones) for fraud, extortion, bullying, and outright violence. And of course markets often make those not involved in them suffer for the benefit of those who are involved. Begs the question, why would anyone want to be involved with such processes, particularly the abstract versions such as financial markets and banking?

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