Theory and Society 42(6)

Theory and Society, November 2013: Volume 42, Issue 6

Social stratification in transitional economies: property rights and the structure of markets
Andrew G. Walder , Tianjue Luo & Dan Wang

In transitions from state socialism, property rights are re-allocated to organizations and groups, creating new markets and new forms of economic enterprise that reshape the stratification order. A generation of research has estimated individual-level outcomes with income equations and mobility models, relying on broad assumptions about economic change. We redirect attention to the process of economic change that structures emerging markets. The process varies across market sectors, depending on the entity that is granted rights formerly exercised by state organs, and on the combination of rights they are granted. The transformation of three sectors in China—agriculture, steel manufacturing, and real estate—shows how different allocations of property rights alter the stratification order in strikingly different ways. Historical analysis of the evolution of markets and enterprises integrates insights from economic sociology into research on social stratification, providing a structural perspective on transitions from state socialism.

Limited liability and its moral hazard implications: the systemic inscription of instability in contemporary capitalism
Marie-Laure Djelic & Joel Bothello

The principle of limited liability is one of the defining characteristics of modern corporate capitalism. It is also, we argue in this article, a powerful structural source of moral hazard. Engaging in a double conceptual genealogy, we investigate how the concepts of moral hazard and limited liability have evolved and diffused over time. We highlight two parallel but unconnected paths of construction, diffusion, moral contestation, and eventual institutionalization. We bring to the fore clear elective affinities between both concepts and their respective evolution. Going one step further, we suggest that both concepts have come to be connected through time. In the context of contemporary capitalism, limited liability has to be understood, we argue, as a powerful structural source of moral hazard. In conclusion, we propose that this structural link between limited liability and moral hazard is an important explanatory factor of the systemic instability of contemporary capitalism and, as a consequence, of a pattern of recurrent crises that are regularly disrupting our economies and societies.

The peculiar convergence of Jeffrey Alexander and Erik Olin Wright
Mustafa Emirbayer & Molly Noble

Jeffrey Alexander and Erik Olin Wright are among the leading sociologists of their generation. Each has published his magnum opus in the past several years: The Civil Sphere (Alexander) and Envisioning Real Utopias (Wright). This paper—a dual review essay—lays out the core arguments of each work; situates each within the personal and intellectual contexts of its production; and critically assesses each in terms of its contributions to sociological theory and research. It also argues that the works converge (unexpectedly, given Alexander’s intellectual origins in neo-functionalism and Wright’s in neo-Marxism) upon a common intellectual position, that of Deweyan pragmatism. It tries to make sense of Alexander’s and Wright’s peculiar dual voyage in a Deweyan direction and offers some reflections as to what that journey might tell us about social theory and political thought today.

Think tanks, free market academics, and the triumph of the right
Fred Block

These two books address different dimensions of the triumphal rise of free market ideas. Thomas Medvetz analyzes the emergence of think tanks as a new organizational form in the United States and explains why they have effectively reduced the influence of most academic intellectuals on policy making. Angus Burgin analyzes the emergence and history of the Mont Pèlerin Society—the free market group that was founded by Friedrich Hayek—which had a decisive influence on conservative thought.