Cultural Turn in Economics - Philosophical Concept | Alexandria
Cultural Turn in Economics represents a paradigm shift challenging the traditional economic assumption that individuals are purely rational actors driven solely by self-interest. It posits, instead, that economic behavior is deeply embedded in social context, shaped by cultural norms, values, beliefs, and institutions. Often intertwined with, and considered a core tenet of, economic sociology, the Cultural Turn questions the view of the economy as an autonomous sphere separate from broader sociocultural forces, inviting exploration into how meaning and motivation intersect with economic decisions.
While difficult to pinpoint a singular origin, the seeds of this intellectual revolution were sown in the mid-20th century, potentially traceable to Karl Polanyi's The Great Transformation (1944). Polanyi argued that market economies are not natural phenomena but rather social constructs requiring state intervention and cultural supports to function, subtly challenging free-market dogma during the burgeoning postwar era. Consider the intellectual climate of the time, amidst anxieties about industrialization and its social cost. Early hints of this cultural perspective also appeared in sociological studies of organizational behavior and consumer culture.
The formal emergence of the Cultural Turn gained momentum in the 1980s and 1990s, fueled by the rise of new institutional economics and the critique of rational choice theory. Influential works by Mark Granovetter, Viviana Zelizer, and Paul DiMaggio demonstrated how social networks, moral considerations, and cultural schemas influence everything from market transactions to charitable giving. The concept of "embeddedness," popularized by Granovetter, highlighted the role of personal relationships and social structures in economic activity. Did these scholars initiate a turn, or merely articulate a slowly forming awareness? They unveiled that economic actors operate not in a vacuum, but within webs of meaning, where trust, reputation, and symbolic value hold as much sway as prices and profits.
The Cultural Turn's influence continues today, shaping research across diverse fields such as behavioral economics, organizational studies, and international development. It has inspired novel explorations into the cultural dimensions of finance, the impact of social media on consumer behavior, and the role of cultural values in shaping economic policy. The ongoing debate over economic inequality, for example, now considers not only material disparities but also the cultural narratives that legitimize or challenge them. But has the Cultural Turn fully permeated economic theory, or does a residual "rational actor" model persist? The enduring mystique lies in the ongoing quest to understand the deep cultural roots of economic life—a project that promises to reshape our understanding of markets, societies, and ourselves.