Should Economics Make a Pragmatic Turn? John Dewey, Karl Polanyi, and Critique of Economic Naturalism

Abstract This article draws upon John Dewey’s pragmatic philosophy to offer a critique of naturalistic assumptions underpinning modern economic thought. More specifically, mainstream economics is criticized for treating its subject-matter as human-independent, maintaining untenable means-ends dualism, and displaying a strong tendency to talk about capitalism and markets as if they were quasi-natural phenomena. Pragmatic arguments are developed in dialogue with the ideas derived from Karl Polanyi, Gunnar Myrdal, and the contemporary philosophy of science. Throughout the article, institutionalism is singled out as an approach to economic the inquiry that is compatible with central insights derived from Dewey’s version of pragmatism. The article suggests that pragmatism together with constructivism and hermeneutics provides a more appropriate philosophical framework for institutional economics than other approaches, including critical realism.