New Relational Paradigm
Source of this paradigm comparison:
Paper for conference with the International Confederation of Associations for Pluralism in Economics (ICAPE) June 1-3 2007 at the University of Utah, Salt Lake City
Science, ideology and development. Is there a ‘Sustainability Economics’?. Peter Söderbaum. School of Business, Mälardalen University, Box 883, 72123 Västerås, Sweden
Comparisons
Aspects compared: | Dominant perspectives | Complementary or alternative perspectives |
Theory of science; role of the scholar in society | Positivism; expert standing outside | Subjectivism, social constructivism, hermeneutics, contextualism; concerned scientist |
Paradigms in economics | Neoclassical | Political approach to institutional economics |
Ideological orientation | ‘Business as usual’ interpretation of SD. Extreme market ideology; GDP-growth, reductionist ideas of efficiency, preference for privatisation (neo-liberalism) | ‘Modernist’ or ‘radical’ interpretation of SD. Priority for Social, Health and Environmental (SHE-) aspects as part of a holistic judgement |
Institutional arrangements | Institutions that facilitate for ‘corporate globalization’ e.g. the present World Trade Organization (WTO) | Subsidiarity principle; Local community development and local markets as starting points. A World SHE-organization “to handle trade disputes” at the global level. |
Aspects compared: | Dominant perspective (Positivism) | Alternative perspectives (social constructivism, hermeneutics, narrative analysis etc.) |
History | History not important; mechanistic models | History matters; evolutionary patterns, path dependence |
Value issues | Objectivity, value-neutrality | Subjectivity matters; dealing with values and ideology in a conscious and open way |
Field of inquiry and position in relation to it | Standing outside observing events; traditional role as expert | Entering into a dialogue of interactive learning with actors and interested parties |
Purpose of study | Looking for universal regularities | Case studies, uniqueness, contextualism |
Methodological guidelines and habits | Quantification, optimal solutions e.g. the ‘monetary reductionism’ of CBA | Illumination of options with respect to ideological orientation and impacts of alternatives; conditional conclusions e.g. disaggregated and ethically open study
in terms of Positional Analysis, PA |
Decision-making | Decisions essentially based on calculation by experts | Matching ideological orientation of each decision-maker and expected impacts of each alternative; ‘appropriateness’, ‘pattern recognition’ |
Aspects compared: | Economic Man | Political Economic
Person (PEP) |
History | Not considered relevant | The individual is a product of
her history and her relationships to specific contexts; path dependence |
Context | Markets for products and factors of production | Political, socio-cultural, institutional
(e.g. market), physical man-made, ecological |
Roles | Consumer, wage-earner | Citizen, parent, professional, market-related roles etc. |
Relationships | Market relationships between selfish market actors | Market and non-market relationships of a cooperative or non-cooperative kind |
Values | Maximum utility of commodities within budget constraint | Ideological orientation as guiding principle e.g. ‘Green’ orientation |
Behaviour | Optimizing | Habitual, ‘rule-following’, also learning and conscious choice (decisions); appropriateness, matching |
Aspects compared: | Profit-maximizing
firm |
Political Economic
'Organization' (PEO) |
History | Not considered relevant | The organization is a product of its history; path-dependence |
Context | Markets for products and factors of production | Political, socio-cultural, institutional (e.g. market), physical man-made, ecological |
Justification for existence | Profits for shareholders | Business concept, mission statement, ‘Core Values’, political ideology, ‘social responsibility’ |
View of individual | Largely invisible | Polycentric organization with individuals
as PEPs, guided by their ideological orientation |
Relationships | Internally: largely invisible, hierarchic
Externally: market relationships |
Interaction (cooperative and
non-cooperative) between individuals as actors, internally and externally, market and non-market |
Interests related to corporation | Consensus idea based on assumed shareholder values | A complex of common and conflicting interests between stakeholder categories
and individuals as actors |
Decision act | Optimization: maximum profits | Multidimensional impact studies, also rule following, matching ideology (mission statement) with expected impacts |
Aspects compared: | 'Neoclassical' perspective
|
'Institutional' perspective |
History | Not considered relevant | Each market relationship has its
history that may or may not involve trust, commitments etc. |
View of individual | Economic Man | Political Economic Person
as actor |
View of organization | Profit maximizing firm | Political Economic Organization
as actor |
Interaction between buyer and seller | Supply and demand | Multifaceted social relationship between potentially responsible market actors |
Goods and services | Homogeneity, one commodity at a time | Also heterogeneity, multiple
commodities and transactions, multi-functionality in relation to many interests and stakeholders |
Motives for transaction | Profits or utility related to quantity and price (optimization) | Ideological considerations ‘monetary price and beyond’ (matching) |
Relations to other actors | Emphasis on personal gain (Belief in ‘invisible hand’) | Also inclusive (‘I & We Paradigm’, ‘Person in Community’) |
Features of relationship | Independence: contracts between parties with conflicting interests | Also cooperation; considerations of trust and fairness |