Customer Reviews

Making of Economic Society, The (12th Edition)

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This book examines the transformation of traditional society into market society: the necessary pre-conditions and steps. The author reminds us that, despite the material advances of modern society, some key economic ideas still apply. All societies must be organized for the material survival of its members. The inter-dependencies among societal members in simpler societies have not been eliminated in market societies, despite the hyping of the independent, self-maximizer by modern theorists; in fact, the complexities of modern societies may well create more dependence, not less. And market societies do have some inherent problems.

The author points out that any society must have a coherent system for producing useful goods and services and then distributing them in a manner sufficient for society's perpetuation. Man has relied upon combinations of tradition, command, and markets to solve those production and distribution problems. Tradition uses time-honored methods of work, "allocated by heredity," which are reinforced by "law, custom, and belief." Change and competitiveness are not tolerated. Command is authoritarian control of economies and is mostly associated with economies operating in rapid catch-up mode, such as the Soviet Union. However, even democracies use elements of command during periods of crisis. In market societies, the aggregation of supply and demand guide economic functioning with no distinct center of control or allegiance to past practices.

Manorial estates and the guilds dominated life in the Middle Ages along with the Church, but the author points to small beginnings of a more commercial world. Itinerant merchants established a small niche for commercial activity in some urban areas. The more successful of them came to be key financiers of monarchs keen on expanding their authority. The gold and silver realized from 16th century New World expeditions stimulated commercial activity. Calvinism, in contrast to the Catholic Church, sanctified hard work and the accumulation of wealth as an indicator of spiritual worthiness. Gradually, feudal society became more reliant upon money as a basis of social exchange. No longer were manorial lords obligated for the overall well being of serfs. The displacement of peasants by the enclosure movements was justified by the opportunities for the landed aristocracy to use their estates as sources of cash revenue.

The author identifies several changes that are necessary for a market economy to emerge. Virtually every task, good, or service has a monetary reward. The anticipation of financial reward guides such decisions as where to labor or what to produce. A society of contracts supercedes a society of status and traditional social bonds. With those changes, a certain amount of social uncertainty is introduced. Yet a market society is not without its own forms of control. The competitions of seller versus seller and buyer versus seller are constraining forces on economic behavior.

Generally it takes a market economy to substantially change the material well being of an entire society. In the first place, traditional societies are not unhappy with the status quo. What is needed are investments in capital goods, or "tools, equipment, machines, and buildings," to increase human productivity leading to higher living standards. And it is the hope for profits or higher wages that spurs investment of money and labor in those goods. But investment implies savings, which, in turn, generally requires a sacrifice in consumption and lower wages. The author suggests that the growing pains of industrialization, mostly on the backs of the working class with the "forced emigration of the peasantry by enclosure and heavy-handed exploitation," could not have been avoided. He undercuts that argument slightly by acknowledging that the forces of democracy in the 19th century ameliorated conditions for the working class.

Scientific and technological advances are often large factors in the development of capital goods and increased productivity. English industrial production literally exploded based on the inventions of such men as Wilkinson, Watt, and Arkwright. The factory system came to dominate English life. New technologies have often literally transformed market societies. The automobile, for example, drastically changed residential patterns, facilitated social independence, and was a massive generator of employment. Can anyone doubt the impacts of electricity, airplanes, television, and computers?

However, the author points out that market societies do not necessarily operate according to the basic theory. "Consumer power" is a first principle of classical economists; according to that notion, consumers force products to be sold "at the lowest price compatible with continued production." But market societies invariably tend to be dominated by a few large firms, where economic efficiencies can be attained. These large enterprises often agree among themselves to set pricing above truly competitive levels. In addition, because much of what is produced in modern economies is non essential, consistency of demand must be created through advertising. While large firms may be needed, consumer sovereignty is mostly a fiction.

Stable market economies must maintain the balances between production and purchasing and savings and investment. Workers' purchasing power must be consistent with production volumes. In addition, savings ought to be converted into investment, or capital formation. The Great Depression was brought about by workers being underpaid and capital investments not being made. The Great Depression and WWII established that government must intervene in a market economy through fiscal and monetary policies to bolster economic stability.

The author emphasizes that basic instabilities remain in market societies. In a market economy, it remains the anticipation of profit on the part of businesses and entrepreneurs that motivates most investment and growth. Technological displacement and unemployment continue to undermine purchasing power. And the author wrote in an era before the evisceration of large "countervailing" unions, the forces of globalization, and a resurgence of rightist, anti-government ideologies. Those developments could have only added to the author's concerns of instabilities.

The book is hurt by not being able to contend with the tremendous changes of the last forty years, though the cautions remain relevant today. It is, however, an excellent guide for understanding the economic and societal changes from the Middle Ages to the era of science and capitalism. Try Charles Lindblom's "The Market System."

This is an excellent introduction to Economic History for undergraduate students. It is concise and well-written, full of poignant examples, tracing economic organization from the Middle Ages through the present. The chapter summaries and discussion questions at the end of each chapter are very useful for both the student and the professor. The brevity of the book leaves open the possibility of including related academic articles or even other textbooks in the syllabus.

The main disappointment is that the nineteenth century--which was full of economic, social, and political change--is basically ignored. The content jumps from the Industrial Revolution to the beginning of the twentieth century. The traditional Euro-American egocentrism is also present.

I'd enjoyed Heilbroner's "Worldly Philosophers" so much that I purchased this title thinking it would be its equal, but sadly that was not the case. That's not to say that "Making of Economic Society" is a bad book or not worth the read, it's just that this book should be read before "Worldly Philosophers" or simply omitted as much of what was put forward in "Worldly Philosophers" is repeated here. Reading the two in the order I did is akin to drinking a glass of merlot and then a glass of chardonnay; its hard to taste the chardonnay is the prior merlot lingers on your palate. Not to mention Heilbroner's conscious or unconscious cribbing from "Worldly Philosophers" leaves you feeling like you've somehow read this all before. The end result is little that is new between the two rendering it down to a matter of personal preference between the two and my own vote is for the much larger, more detailed "Worldly Philosophers" and my own advice is to skip directly to that over this title.

I'd enjoyed Heilbroner's "Worldly Philosophers" so much that I purchased this title thinking it would be its equal, but sadly that was not the case. That's not to say that "Making of Economic Society" is a bad book or not worth the read, it's just that this book should be read before "Worldly Philosophers" or simply omitted as much of what was put forward in "Worldly Philosophers" is repeated here. Reading the two in the order I did is akin to drinking a glass of merlot and then a glass of chardonnay; its hard to taste the chardonnay is the prior merlot lingers on your palate. Not to mention Heilbroner's conscious or unconscious cribbing from "Worldly Philosophers" leaves you feeling like you've somehow read this all before. The end result is little that is new between the two rendering it down to a matter of personal preference between the two and my own vote is for the much larger, more detailed "Worldly Philosophers" and my own advice is to skip directly to that over this title. Despite the addition and refinement over previous editions there isn't enough here to recommend it over "Worldly Philosophers."

While I do believe Mr. Heilbroner pulled a few punches; This book is well worth the time it takes to read it. Only occassionally is the prose is hard to follow. It is worth the effort to re-assemble the few hidden diamonds of understanding. Thought provoking and still relevant in 2011. 90% of it will be relevant 100 yrs from now. Reviews the different kinds of economies and how they developed and how politics is a distinct part of economic society. I liesurly read the 222 pages in 10 days.

Content Summary: Heilbroner's introductory text "The Making of Economic Society", reviews the development of economics from the Middle Ages of Feudal Europe through the height of the industrial revolution and to the present day information age. Intended for introductory economics students, it could also be enjoyed by the casual or curious reader who wanted to review basic economic history and theory.

Analytical Review: Heilbroner's style is very accessible. This is a readable book. You don't have to be an economist find something interesting in it. I found Heilbroner to take a fairly balanced view of the merits of capitalism and Adam Smith (which he clearly favors), but also an appreciative view of the Marxist spirit of equality. Heilbroner's book is concise without sacrificing thought-provoking questions and content.

The book provided a fairly decent foundation for the concepts it presents, though I feel as though it does so in an overly wordy and diffuse manner. The authors frequently make sweeping statements about a general topic with little to no evidence; indeed, little to no evidence even exists for some of the generalizations made. Similarly, the authors frequently pose what appears to be a significant question at the beginning of a section and then do little to answer it, instead jumping from topic to topic as if to say "look how much stuff we know!" I know I have a bias in coming from the physical sciences, but I believe students and instructors can find a clearer and more concise overview of the material in another book.

I've read several of Robert Heilbroner's books and this one had some real pearls of wisdom. It starts slow going all the way back to the 1400's but he gets into some great economic theory towards the late 1800's. His perspective of the "robber barons" was interesting. The last chapter is a gem in his analysis of why capitalism works but not too well in the US. In summary, this book (written a long time ago in the early 60's) is a great compliment to a Thomas Sowell.

the book is a uninteresting read for those who dont study this subject but it is also a good beginners book for those who will study the subject...

This book was a perfect price! Much cheaper than anywhere else. Also, the book came right on time! It even arrived before the date I was given. So, I was completely satisfied!