The Power of Ideas: Keynes, Hayek, and Polanyi

Abstract

The history of intellectual movements during the twentieth century suggests that ideas can play a transformative role in society. John Maynard Keynes's revolutionary ideas formed the basis of the postwar institutional structure but only after the political and economic conditions permitted it. Hayekian neoliberalism took hold only after the 1970s with the rise of globalization and financialization and with the progressive erosion of democracy. Karl Polanyi's vision advises that financialization/globalization has created problems that go beyond the debate over stimulus versus austerity and raises questions about the viability of a universal market economy.