Conceptualizing Capitalism and the Confusing Variety of Capitalisms

‘Conceptualizing Capitalism. Institutions, Evolution, Future’ (Hodgson, forthcoming 2015) is a grand attempt to extract the essence of capitalism, to stress the crucial role of its constituent institutions such as the state and law, and to understand its emergence, development and future prospects. This is a work which follows the lead of Marx, Schumpeter, Hayek and others in its encompassing inspirational vision, and cultivates a new field of endeavour in its carefully elaborated novel approach.  Hodgson’s understanding of capitalism stresses not only the existence of varieties of capitalism but also how the interaction between different varieties plays a crucial role in the evolution of capitalism

While acknowledging the conceptual soundness and the huge inspirational potential of Hodgson’s contribution as a research programme, this article is an attempt to challenge the limits of Hodgson’s reconceptualization of capitalism by filtering a number of actually existing varieties of capitalism though his conceptual gaze. The emergence of a state with monopoly of violence and strong enough to guaranty property and contract but constrained by checks and balances and independent legal institutions is a constituent characteristic of capitalism as defined by Hodgson. Four varieties of capitalism seems to be at odds with this definition: (a) contemporary state capitalist China, (b) post-1991 ‘wild east’ Russian capitalism, (c) deeply corrupt, kleptomaniac capitalism in some African countries, and (d) human and material resource exploitation by a domestic leisure class in the Middle East. The article discusses to what extent Hodgson’s understanding of capitalism can be seen as Euro-centric or even Britain-centric in its stress on the role of the state and law.