A History of Contemporary Political

Economy and Postmodernism

STAVROS D. MAVROUDEAS
University of Macedonia, Department of Economic Studies,156 Egnatia St., P.O. Box 1591,
54006 Thessaloniki, Greece; e-mail: smavro@uom.gr
Received March 23, 2004; accepted January 14, 2006

Abstract
The study of the history of economic theory is entwined with nonneoclassical and especially Marxist
political economic analyses, which relate the creation of an autonomous science of economic relations
to the establishment of capitalism. Usually, the main agents in this interaction are social groups and
especially social classes. Contrarily, neoclassical orthodoxy understands the history of economic theory
as mere history of economic thought, a succession of personal contributions with limited relation to
socioeconomic conditions. The relation between economy and economic theory is theorized through an
asocial perspective, because social classes and politics are excluded and methodological individualism
reigns. Recent postmodernist interpretations advance a historicist, relativist, politicist view. The reasons
for creating an autonomous science of economic relations are to be found not in socioeconomic rela-
tions but mainly in the field of the political. This article criticizes postmodernist interpretations from a
Marxist perspective, rejecting them as historically unfounded and analytically infertile.

JEL classification: B000; B41; B50

Keywords: postmodernism; political economy; Marxism

1. Introduction

If there is a canon in the interpretation of political economy, this is provided by non-

neoclassical and especially Marxist views, and it is based on an objective sociohistorical
perspective. Indeed, the study of the historical creation and theoretical content of political
economy is an area dominated to a great extent by nonneoclassical (institutionalist, post-
Keynesian, neo-Ricardian, radical political economy) and particularly Marxist interpreta-
tions. There are important reasons for this: the main focal points of political economy (the
primacy of production over relations of exchange, value theory, social classes, and the

Author’s Note: The author wishes to thank Cyrus Bina for his inspiring comments and also for making the
article much more readable. Of course, any remaining mistakes and the views in this article rest with the
author.
Review of Radical Political Economics, Volume 38, No. 4, Fall 2006, 499-518
DOI: 10.1177/0486613406293217
© 2006 Union for Radical Political Economics
499
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500 Review of Radical Political Economics / Fall 2006

interrelationship between the economic and the political sphere) have been discarded by
neoclassical economics in favor of a theory of prices and an economics-of-exchange
perspective. The original political economy framework has been retained only by these
dissenting traditions.
The interpretations generally argue that the establishment of capitalist economies
necessitated the creation of an autonomous science of economic relations. On the basis of
these objective foundations of the relation between economy and economic theory, the
construction of political economy is explained. An explicit social perspective underlies this
theorization because the main agents in the society and the economy—but also the main
sources of theoretical inspiration—are social collectivities and particularly social classes.
In contrast, orthodox economics understands the process of creation of an autonomous
science of economic relations as mere history of economic thought, that is, as a succession
of more or less individual contributions with rather limited relation to socioeconomic con-
ditions. The relation between economy and economic theory is theorized through a his-
toricist and mainly asocial perspective because for orthodox economics, social classes
have no relevance, politics are excluded, and methodological individualism reigns.
During the past decades, and under the diffusion of influence of the postmodernist
trend within social sciences, another line of interpretation emerged. This interpretation—
in contrast to both the nonneoclassical and Marxist emphasis on socioeconomic factors
and the neoclassical asocial perspective—advances a politicist, historicist, and relativist
view. It is politicist and historicist because agents’ actions are considered as almost inde-
terminate and history is perceived as totally unbound and open. It is also relativist because
no causal relations are recognized.
Material socioeconomic factors—if theorized at all—are being reduced to mere his-
torical accidents caused by concrete historical conjunctures. At the same time, discursive
elements assume an overarching importance. This is expressed in the supposed explana-
tory primacy of politics, which is divorced from material factors and linked solely to dis-
course. Politics is understood as an ideological-cum-semiological terrain and explains the
specific outcome of struggles in concrete historical conjunctures. Theory, also, is autono-
mized from socioeconomic evolution and related to contingent and subjectivist political
influences.
This perspective results in a politicist interpretation of political economy because the
reasons for its emergence are to be found not in the socioeconomic framework but mainly
in the field of the political (Meuret 1988: 225).
This article criticizes the postmodernist interpretations from a Marxist perspective.
Section 2 provides a general analysis of postmodernism within the social sciences. Section
3 traces the impact of postmodernism in economics. The fourth section argues that there
are important covert links between recent neoclassicist “imperialism” and postmodernism.
Section 5 criticizes postmodernist reinterpretations of the history of political economy and
their dispute over the “canon” of interpretation, believed to be common in all “modernist”
approaches (neoclassicism, Keynesianism, Marxism). This discussion focuses on Meuret’s
(1988) thesis of the political genealogy of political economy, which provides a powerful
version of the postmodernist reinterpretation of the creation of political economy. The last
section concludes. Overall, the postmodernist perspective and its attempt to rewrite the
history of the evolution of economic theory are criticized for being historically unfounded
and analytically infertile.

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 Mavroudeas / Contemporary Political Economy and Postmodernism 501

2. Postmodernism and the Social Sciences

Postmodernism as a broad trend in social sciences—and in culture—was born out of a

widespread disappointment within the radical intelligentsia with the end of the “high hopes”
of the 1960s. Eagleton (2003) offered a lucid account of this path that ultimately led to post-
modernism. The retreat of the tide of mass movements and social and political struggles left
only fragmented remnants behind. Furthermore, the conquests and the theoretical advances
of that period, although unambiguously important, proved unable to confront capitalism’s
radical restructuring in the decades after the structural crisis of 1974-1975.
Much of this retreat was self-inflicted. The 1960’s movements had a mainly student and
middle-class social basis, and appeared not only in an era of economic prosperity but also
just before the eruption of a structural crisis. The mixture proved self-defeating. By pro-
nouncing a vociferous revolutionary rhetoric, they set utopian political aims. At the same
time, they failed to establish significant roots in those social classes and strata that were
less well-off (usually the working class) and to which they appealed. Their overpropor-
tionally universalist theoretical endeavors, together with unrealistic maximalist politics
and the lack of adequate class bases, led them to an almost unconditional retreat once cap-
italism’s crisis (which they professed) truly erupted. Faced with the system’s unremitting
and far-reaching restructuring attempts, they offered no significant resistance.
Furthermore, the coming of hard times for the great mass of the working population made
even bigger the gap between it and the maximalist political and theoretical rhetoric of
those student and middle-class movements.
This, instead of causing a far-reaching self-critique, led a significant segment of the
radical intelligentsia to deep disappointment and the almost complete overturn of its pre-
vious positions. As Eagleton (2003: 51) accurately pointed out, “[A]fter the debacle of the
late 1960s, the only feasible politics seemed to lie in piecemeal resistance to a system
which was here to stay.” The system could be disrupted but not dismantled.
This sense of disappointment led to postmodernism. Rejection of any universal analy-
sis, disbelief in the possibility of any social overturn, retreat to small and fragmented
issues, together with an intellectually amusing (to some extent, but socially and politically
irrelevant) aesthetic sarcasm, are its hallmarks.
Postmodernism’s main thesis is that there cannot be objective criteria for assessing the
truth. There can be many different analyses, and all these are equally legitimate. The rea-
son for this is that there cannot be a separation between what is to be explained (signified)
and its explanation (signifier). For the more extreme postmodernist versions, reality does
not exist on its own but only as its conception by humans. For the more qualified versions,
reality might exist independently, but this is irrelevant to humans. Moreover, different
explanations shape different “realities.” All knowledge is partial, limited, and contingent.
Thus, grand theories1 are irrelevant because the interplays between signifiers and signi-
fieds are so many and diverse. This thesis is supplemented with an explicit lack of faith in
the capacity of human reason to reach universal explanations. Lyotard (1984: xxiii) criti-
cized sciences for tending to legitimize themselves with reference to some metadiscourse
or “grand narrative,” such as the dialectics of spirit, the hermeneutics of meaning, the

1. General or grand theories analyze the whole spectrum from the more abstract laws and concepts to the
empirical analysis within a unified framework.

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502 Review of Radical Political Economics / Fall 2006

emancipation of the rational subject or of the working class, or the creation of wealth. In
contrast, he defined postmodernism as “incredulity towards metanarratives” (Lyotard
1984: xxiv).
Because postmodernism downgrades the role of material relations, discourse becomes
its main field. Discourse is not simply ideology in its classical sense. As Purvis and Hunt
(1993) accurately showed, ideology refers to explanations more or less grounded on mate-
rial conditions, however inaccurate or fetishist they may be. On the contrary, discourse—
coming from the recent linguistic turn in social theory—implies that language (and other
forms of semiotics) not merely conveys social experience but also constitutes social
subjects (their identities) and the environment within which they exist. Thus, discursive
elements and the whole variety of possible interplays between signifier and signified
become the center of attention. Nothing can exist without its discursive reflection; the sig-
nified is inseparably bound to its signifier.
Postmodernism’s favorite methodology is deconstruction. The artificial universality
of the grand narratives has to be torn down by deconstructing it in its partial, fragmented,
contingent, and possibly conflicting discursive elements. In addition, deconstruction
questions even the correspondence between signifier and signified because, as Derrida
argued, these two categories are interchangeable. Therefore, any notion of causality is
rejected and substituted with propositional undecidability (Platt 1989; Derrida 1981).2
Deconstruction avoids any propositional commitment because there are no essential and
causal determinations relating its objects of analysis to one another. The result is a bla-
tant relativism.
It is informative how Platt (1989) attempted to apply postmodernism in social sci-
ences. To substitute relations of causality, he borrowed the term recursion from computer
science. Recursion refers to structures or networks that define themselves in progressively
simpler terms. A recursive network is one in which distinctions of level can be made on
the basis of repeated self-referencing operations. In such a system, there exist relations but
without causality. This relational but also indeterminate approach gives a typical example
of postmodernist relativism.
Finally, propositional undecidability is coupled with methodological individualism.
Postmodernism poses again the perennial structure-agency riddle and completely disman-
tles it: there are no structures (even structural tendential laws and relations) but only agents
that operate discursively. Any collective relations are short-term, contingent, discursive
constructions of groups of agents. Thus, in the beginning it is the agent, the individual.
Individuals through mimesis, repetition, and habits create social environments (although
postmodernism is suspicious of the very concept of society).
When this comes to history, it recourses to historical relativism (see Raulet 1989: 160).
History is a chance outcome in which personalities have an overarching importance; this
is evident in Meuret’s genealogy of political economy, which is analyzed in the last part of
this article. Anderson (1988) argued that this leads to a randomization of history. In a sim-
ilar vein, Wood (1995: 5–6) stated that postmodernism studies “historic change without
history”:

2. Derrida (1981: 219), following Godel, defined as undecidable “a proposition which, given a set of
axioms governing a multiplicity, is neither an analytical nor deductive consequence of those axioms, nor in
contradiction with them, neither true nor false with respect to those axioms.”

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 Mavroudeas / Contemporary Political Economy and Postmodernism 503

There is no such thing as a social system (e.g., the capitalist system) with its own systemic unity
and “laws of motion.” There are only many different kinds of power, oppression, identity, and
“discourse.” Not only do we have to reject the old “grand narratives,” like Enlightenment con-
cepts of progress, but we also have to give up any idea of intelligible historical process and
causality—and with it, evidently, any idea of “making history.” There are no structured
processes accessible to human knowledge (or, it must be supposed, to human action). There are
only anarchic, disconnected, and inexplicable differences. For the first time, we have what
appears to be a contradiction in terms: a theory of epochal change based on a denial of history.

Callinicos (1985), taking as criterion their method of theorizing discourse, distinguished

two major postmodernist strands. The first, associated with Lyotard, draws heavily on a
version of analytical philosophy of language (speech-act theory). The second strand is
poststructuralism, which is itself divided into two substrands. On one hand, there is
Derrida’s textualism (a true heir of German classical idealism), which denies the possibil-
ity of ever escaping the discursive; discourse has no extradiscursive referents and encom-
passes all the aspects of reality. On the other hand, Foucault, Deleuze, and Guattari
proposed a version of worldly poststructuralism, which, in contrast to Derrida’s idealist
theory, proposes an articulation of the discursive and the nondiscursive. It is basically
worldly poststructuralism that operates as the springboard for the invasion of postmod-
ernism in the social sciences (economics included).
Worldly poststructuralism meets the poststructuralist and post-Marxist theories3 of
another strand deriving from Althusserian structuralism and a mistreatment of Gramsci’s
work. The typical and most representative exemplification of this strand is provided by
Laclau and Mouffe (1985). Wood (1986) and Geras (1987) have offered accurate and
scathing critiques of their theses. It is necessary, however, to point out certain aspects of
these theories that operate as their discrete links with postmodernism.
To start with, the scapegoat of “essentialism,” especially in the form of the supposed Marxist
economism, is once again ceremoniously thrown into the fire. Consequently, structural relations,
and especially class relations, are purged, downgraded, or relativized, and, instead, discourse
assumes explanatory primacy. There are no such things as material and class positions and
actions, but only discursively constructed ideas about them. As Wood (1986: 62) remarked,

In this, Laclau and Mouffe have followed the now familiar trajectory from structuralism to
poststructuralism—though they seem uncertain whether the poststructuralist dissolution of
reality into discourse can be regarded as a general law of history (as it were) or whether it
is only in the modern age, and particularly with the advent of “industrial society,” that
social reality has dematerialized and become susceptible to discursive construction.

Anderson (1988: 40–55) has given a lucid and accurate account of the links between
structuralism and poststructuralism. He delineated three major themes that established, in
successive stages, the trajectory from structuralism to poststructuralism. First, the originat-
ing discipline from which structuralism drew virtually all of its concepts, and then projected
them to all areas of society, was linguistics, leading, thus, to what Anderson termed the
exhortation of language. Second, this absolutization of language led to the attenuation of

3. It should be noted that both Lyotard (explicitly) and more recently Derrida (with his Spectres of Marx
[1984]) have advanced variants of post-Marxism, which, however, have not had a significant impact in social
sciences in general and in economics in particular.

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504 Review of Radical Political Economics / Fall 2006

truth. The precarious balance between the signifier and the signified, inherent in struc-
turalist linguistics, severed any possibility of truth as a correspondence of propositions to
reality. This, in return, implied a critical weakening of the status of causality. “Causality,
even when granted admission, never acquires cogent centrality on the terrain of struc-
turalist analysis” (Anderson 1988: 50). The result of this process was the randomization of
history. Because causality is weakened, an unbridgeable gulf exists between the general
laws and causes and the actual events. So, there is the paradoxical result that a total initial
determinism ends in the reinstatement of an absolute final contingency. All these three
major themes, described by Anderson, lay at the heart of the notorious structure-subject
riddle and paved the way to poststructuralism. It takes only the unavoidable questioning of
the validity and the weight of the distinction between signifier and signified to detonate a
chain reaction leading to poststructuralism. In a nutshell, the way that structuralism for-
mulated and is believed to have solved this riddle contained the seeds for a subsequent cap-
sizing into its antithesis; poststructuralism proper is born.
As Wood (1995) has shown, this trajectory from structuralism to poststructuralism has
assumed flesh and bones in the journey of certain intellectuals from Althusserianism to
post-Marxism. She accurately identified Poulantzas as their forerunner. For these intellec-
tuals, the explanatory primacy of discourse is based on the autonomization of ideology and
politics from the economy. This is supplemented with the randomization of history and
politics. The first implies that the discursive elements cease to be determined, even in the
last instance (according to the Althusserian past of these writers), by the economy. This is
part and parcel of their antiessentialist and antireductionist drive, and their quest for “open-
ness” and an “unsutured” theory. The randomization of history and politics leads, however,
to historicism. The result is an awkward hybrid of (implicit) absolute determinism and
absolute contingency, with the emphasis on the latter. Following their Althusserian struc-
turalist past, Laclau and Mouffe theorized structures and laws in a rigid, static, and nondi-
alectical way (worthy, indeed, of mechanistic determinism) that, in return, enables
them—but now under the new banner of poststructuralism—to reject them in favor of the
indeterminacy of the historically specific.

3. Postmodernism in Economics

It is only in the past decades that postmodernism made inroads in the field of eco-
nomics. This is not strange because it considers that the primacy of the economy in the
study of socioeconomic relations is the basis of the essentialism and economism of all the
so-called modernist discourses (neoclassicism, Marxism, etc.).
It is difficult to classify the postmodernist trends in economics because, in a sense,
they are “postmodern” themselves, that is, quite different in origin, analysis, and scope.
Screpanti (2000), from a postmodernist perspective, proposed a classification. He argued
that all previous economic theories (classical, Marxist, and neoclassical) are modernist
because they share the same assumptions:

1. A humanist ontology, that is, the conviction that economic science deals with a “rational agent” that
is the active subject of social action. Neoclassicism proposes the homo economicus, whereas Marxism
proposes the homo faber.

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 Mavroudeas / Contemporary Political Economy and Postmodernism 505

2. A substantialist theory of value, that is, behind the surface phenomenon of prices (an appearance in
Marxist terms) lays its hidden determinant, the values (an essence or substance). For neoclassicism,
it is the subjective value of preferences; whereas for Marxism and the classicals, it is the objective
value of labor.
3. Equilibrium analysis.
4. A metanarrative of humankind, that is, a belief that the human subject is able to lead reality toward a
logically conceived universal goal.

For Screpanti, all these can be summarized in the twin original sin: determinism and
essentialism. For him, the best promise for the reconstruction of economics lies with the
various currents that comprise the emerging postmodern galaxy in economics. Their
common foundation is the rejection of this twin original sin. He classified as such neo-
Austrianism, the complex systems approach, and post-Keynesianism, but most promi-
nently new institutionalism and post-Marxism. It can easily be discerned that his emphasis
is on new institutionalism, which appears to almost engulf every other current. Screpanti
explicitly disavowed neoclassical institutionalism as exhibiting only limited postmodern
inclinations. He argued that the new radical institutionalism is the product of works com-
ing from Marxist, post-Keynesian, and traditional institutionalist economics that reject the
original ontological holism of their traditions and merge toward a common new approach.
Its basis is a new, weak ontology based on the observation of actual people, in which indi-
viduals are intentional agents but with bounded rationality, and institutions are artifacts
that simplify human choices and stabilize social relations.
In a similar vein, Garnett (1999) argued for a postmodern revolution in economics
based on a pluralistic institutional-cum-Marxist dialogue. The agenda of this dialogue is
the rejection of the labor theory of value and its substitution by a “social value” that is
founded—following Mirowski’s (1991) institutionalist perspective—on contingent social
institutions (money, culture, etc.).
If there is something that surely needs deconstruction, this is Screpanti’s formulation.
Being in a rush to create the agent of his new—and far more radical than the three previ-
ous ones (the classical-Marxian, the marginalist, and the Keynesian)—revolution in eco-
nomics, he enlisted trends that are quite different even for a postmodernist. Some of the
trends are rather insignificant and act more as cosmetic fellow travelers than as real
“agents.” He was also in a hurry to create the “enemy.” Therefore, he bundled together
under his four modernist criteria the classicals, Marxism, and neoclassicism irrespective of
their unbridgeable differences.
First, Marxism’s (and to a certain extent the classicals’) conception of social labor can-
not be downgraded to a homo faber that is homologous to the neoclassical homo econom-
icus. Screpanti unjustifiably dressed Marxism in neoclassical individualist clothes for his
own convenience. Furthermore, as will be shown below, postmodernism has much more in
common with neoclassical individualism.
Second, Marxism’s dialectics of form and substance and its objective labor theory of
value have nothing in common with neoclassical contentless abstractions and neoclassical
subjective utility theory of value (see Mavroudeas 1999a). The first posits substance in the
sphere of production and form in the sphere of circulation. Abstraction is used to move
from observable phenomena (the sphere of circulation) to their hidden determinants (in the
sphere of production). On the contrary, the utility theory of value oscillates between prices
and individual preferences. It lacks a coherent distinction of spheres, and its abstractions

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506 Review of Radical Political Economics / Fall 2006

are truly contentless because there exist well-known problems in defining utility. In addi-
tion, the methodology of dialectical abstraction is radically different from positivist
abstractions. Last, but not the least, neoclassical economics has long ago ceased to use any
kind of value theory. Once the concept of marginal productivity had been introduced, there
was no need for a reference to any value theory (see Gramm 1988).
Third, Screpanti’s critique of equilibrium is probably appropriate for neoclassical gen-
eral equilibrium models but is irrelevant for Marxism’s use of equilibrium analysis within
the framework of dynamic models. Neoclassical economics infers that the economy actu-
ally tends to equilibrium. Thus, equilibrium analysis is supposed to reflect the real eco-
nomic process. Even most neoclassical disequilibrium models are simply more
sophisticated versions of this approach. On the contrary, Marxist dialectical analysis uses
equilibrium in a totally different sense. It reflects long-term centers of gravity (i.e., equili-
brating forces) brought into existence by a system in disequilibrium. Equilibrium is never
a real state of affairs; quite the opposite. Marx’s treatment of the value-price relation is
characteristic: values determine (and are the long-run centers of gravity of) prices, but the
latter almost never actually coincide with them. Thus, whereas neoclassical models search
for an almost presupposed equilibrium (stability), Marxist models usually analyze crisis
and instability.
Finally, Screpanti ended up with a metanarrative of his own: postmodern economics as
the more radical endeavor in economic analysis that subverts the fallacies of its precursors.
A more balanced approach would reveal that there is a weak but common foundation
for various postmodernist currents in economics. This consists in a rejection (or radical
weakening) of causality, a prioritization of discourse, and a rejection (or radical weaken-
ing) of the notion of structure. This is supplemented with recourse to either methodologi-
cal or institutional individualism. Postmodernist inroads in economics may be grouped in
three broad theoretical categories:

1. A middle-of-the-road trend, organized in the area of radical political economy around the remnants of
some of the newer, nonorthodox, “middle-range” theories4: Regulation (Aglietta 1979; Lipietz 1983)
and Flexible Specialization (Piore and Sabel 1984)
2. A current deriving from the Althusserian tradition (Amariglio and Ruccio 1994; Callari, Cullenberg,
and Biewener 1994)
3. A host of authors flowing from the Keynesian, post-Keynesian, and institutionalist, but also heterodox
neoclassical trends (Samuels 1990, 1991; Mirowski 1991; McCloskey 1985; Klamer, McCloskey, and
Solow 1988; Weintraub 1991)

3.1 The Newer, Nonorthodox, “Middle-Range” Theories

This current of theories is usually disregarded in postmodernist classifications.

Screpanti (2000: 105) fleetingly referred to them but for rather erroneous reasons. He

4. “Middle-range” theories reject abstract general laws and the necessity of a general theory, for which is
substituted intermediate concepts with an almost immediate identification with the most concrete phenomena
or with empirical observations believed to be so (stylized “facts”). The newer, nonorthodox, middle-range the-
ories are a group of theories that dominated radical political economy after the 1970s. Prominent among them
are regulation, the American social structures of accumulation, and the flexible specialization thesis (see
Mavroudeas 1999a).

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 Mavroudeas / Contemporary Political Economy and Postmodernism 507

enlisted them in post-Marxism—where they do not belong per se—and he praises their
rejection of stages theory, which is also wrong.5
This host of theories is influenced mainly by “worldly poststructuralism.” They main-
tain that a radical historical change has taken place and that we live in a new postmodern
era of capitalism (post-Fordism, second industrial divide, etc.). Hence, postmodernist ele-
ments in their theories are the reflection of real changes rather than simply a theoretical
perspective. Poststructuralism and post-Marxism are their usual vehicles for the passage to
postmodernism.6
These theorists want to distance themselves from structuralism (which, in the case of
Regulation, was its initial referent) and give agents more freedom. This is closely related
to how they theorize the relation among economy, politics, and ideology. They exhibit a
gradual trajectory from an initial mild structuralism toward poststructuralism and ulti-
mately postmodernism. In addition, conceptual relativism, multicausality, and eclecticism
crept in and ultimately conquered their analysis. Finally, new institutionalism becomes—
implicitly in the beginning, and explicitly later on—a major source of inspiration.
There is extensive recognition of their relation to postmodernism. Lash (1990), proposing
a political economy of postmodernism, believed that a “regime of signification” is coarticulated
with a “regime of accumulation” (one of Regulation’s major concepts). On this basis, he
defined the new restructured form of capital accumulation as “post-Fordism” or “disorga-
nized capitalism”, which is characterized by a turn from mass production and consumption
to the services and information economy, flexible production, and specialized consumption.
With regard to the social aspect, the working class is being shrunken and fragmented, resis-
tance is apportioned to decentralized and multicollective (interclass) social movements, and
individualism returns. In addition, Lash argued that this new (post-Fordist) regime of accu-
mulation is being transformed with accelerating rhythms to a regime of signification
because both the means and the forces of production acquire an increasingly cultural—
rather than strictly economic—hue. The forces of production are no longer mediated by the
material means of production, but constitute issues of discourse and communication
between management and workers. Lash suggested that the widespread implementation of
quality circles and team briefings is an obvious and undeniable proof of this alleged trans-
formation. For the informed reader, it is obvious that all these theoretical elements are loans
from the Regulation Approach and Flexible Specialization theory. This account is supple-
mented with references to Williamson’s neoclassical institutionalism and Bell’s theory of
postindustrial society. Also, Laclau and Mouffe’s post-Marxism in its solitary and vague
economic references invokes Regulation’s regimes of accumulation.
This does not mean that the newer, nonorthodox, middle-range theories adhere heart
and soul to postmodernism and post-Marxism. On the contrary, they represent a middle-
of-the-road choice. In the regulationist tradition, Lipietz introduced bashfully the concept
of the universe of discursive and political representations as a counterpart for the usual
concepts of the regime of accumulation and the mode of regulation. Aglietta, in his latest
works, moved further to discard the initial regulationist theory and to adopt Foucault’s
theory of power, Baudrillard’s historical account, and Girard’s methodology as his new
framework.

5. For a critique of regulation’s theory of periodization, see Mavroudeas (1999b).

6. For an analysis of regulation’s relation to postmodernism, see Mavroudeas (1999a).

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508 Review of Radical Political Economics / Fall 2006

The Flexible Specialization theory, however, adopts an even more relativized, histori-
cist perspective and for this argues for its superiority against Regulation (Hirst and Zeitlin
1991). Mass production and its flexible successor are accidental historical creations rather
than inherent necessities of capitalism (Sabel and Zeitlin 1985). The saturation of mass
standardized products’ markets led to a change in consumer preferences and the creation
of market niches based on quality characteristics. In addition, the exhaustion of Fordist
technical capabilities and the crisis of the 1970s led to the reemergence of flexible, small-
scale production. This combination is crystallized in the creation of a new technological
paradigm based on flexible, programmable machinery able to respond swiftly to demand
changes, using multiskilled workers in a context of cooperation and competition exempli-
fied by the modern-day neo-Marshallian industrial districts. The result is the new era of
flexible specialization. It is interesting that the sphere of consumption and its “liberation”
from supply-side constraints are considered the driving forces of these developments.
Thus, true consumer sovereignty is established, and furthermore consumer preferences are
formed on the basis of status and discursive elements. Curiously enough, Baudrillard’s
postmodernist theory of consumption is not invoked.

3.2 Post-Althusserian Postmodernism

This current is grouped around Rethinking Marxism, an American journal. It provides

links with the British Althusserian branch and the Economy and Society journal, although the
latter is closely associated with the flexible specialization thesis (see Hirst and Zeitlin’s 1991
critique of Regulation and their explanation of the superiority of Flexible Specialization). For
example, Amariglio and Ruccio (1994) maintained that their rejection of the “essentialism of
the market”—according to them, found in both Marxism and Hayekian liberalism (and
indeed in many other types of essentialism as well)—is similar to that of Hindess (1987).
This current does not accept the notion of a postmodern epoch (contrary to Laclau and
Mouffe, who have roots in the Althusserian tradition). Amariglio and Ruccio (1994)
rejected the identification of the character of the economic theory with any contemporary
economic process.7 Instead, they tended to propose a version of postmodern Marxism as a
general theory. They criticized neoclassical, Keynesian, and Marxist theories for their
common foundational axes: (1) order (strict causal determinism leading ultimately to sta-
bility), (2) centering (assuming that the economic subject is rational), and (3) certainty
(closed theories with no room for uncertainty). Their postmodern Marxism ascribes to the
opposite poles (disorder, decentering, and uncertainty). They also rejected Marx’s analysis
of systemic laws and necessity, and substituted it with the indeterminacy of historical con-
tingencies. This is coupled with the Althusserian theory of ideology and its methodology
of overdetermination. It is ideology and, in the end, discourse (not material conditions) that
provide the social dimension of agents. Then, overdetermination and the process-without-
a-subject are used to weaken any systemic causality and make socioeconomic processes
contingent and uncertain. Particularly, their use of overdetermination is very similar to
Platt’s “recursion”: independent systems sit on top of each other and have mutual influence
without any causal primacy.

7. Amariglio and Ruccio (1994: 9) rejected as unfounded and simplistic the emergence of an era of
“consumerism”.

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 Mavroudeas / Contemporary Political Economy and Postmodernism 509

This post-Althusserian project of a postmodern Marxism is inherently contradictory.

First, postmodernism rejects general theory in principle, and this cannot be salvaged by
preaching that others can have their (postmodernist) theories. In addition, its Marxist char-
acter is rather a matter of personal aesthetic preferences than a serious proposition. After
all, what kind of Marxism would this make without a referential primacy to material con-
ditions and a dialectical materialist methodology? But its Althusserian character is not
without problems either. For example, it is not answered convincingly how poststructural-
ism can be truly reconciled with the Althusserian structuralist approach of “a process with-
out subject.” It is true—as has already been explained—that latent links exist between the
prima facie opposite trends of structuralism and poststructuralism. But this does not make
the transition from one to the other less contradictory. Finally, the Althusserian theory of
ideology is based on the theory of theoretical practice. According to the theory of theoret-
ical practice, the scientificity or truth of thought is judged by the purely internal criteria of
theoretical practice, not by its dialectical relationship to concrete reality. The result of this
thesis is the crude counterposition of an empirically understood reality and a theory rid-
dled with scientism. In a way, the Althusserian purge of dialectics and its substitution with
a structuralist formalism ended up with a version of the relation between reality and theory
on the same lines with the positivist dichotomy of “model-real world.” It is true, however,
that at the same time it opened the floodgates for subsequent positions which keep the
separation between model and real world—it questioned the objectivity of the model and
relativized even more its content. In post-Althusserian postmodernism, not only is theory
separated from reality, but also there are no “internal” criteria for the judgment of scien-
tific truth. But, although Althusserianism opened these gates, a lot of work was needed to
pass through them. This was not Althusser’s doing but that of his epigones. Consequently,
the invocation of Althusser as a “post-modern” thinker (Ruccio 1991: 500) is rather
exaggerated.

3.3 Heterodox, Keynesian, and Institutionalist Postmodernists

Finally, there is a large host of writers coming from a number of traditions in eco-
nomics who have questioned the element of objectivity in economic theory. These writers
have stressed the social construction of theory as discourse; the decentering of the subject
(i.e., multiple subject-positions exist); and consideration that subjectivity is not prior to,
but is constituted by, systems of language, power, and other social factors. Therefore, sci-
entific objects are always preinterpreted, and science cannot be separated from rhetoric.
Hence, value judgments cannot be purged from theory in the way orthodox economics—
via the normative/positive economics distinction—does. Finally, they have questioned the
traditional scientific boundaries within the social sciences.
It seems that this diverse host of writers is quite close—although without explicit
reference—to textualist postmodernism, in the sense that they concentrate on discursive
elements. Extradiscursive referents are not used or appear to have almost no consequence
in these writings.
Their starting point is the social construction of economic subjects. Assaulting the neo-
classical orthodoxy, they maintain that economic theories are socially constructed and non-
value free. In this way, the purported neoclassical monopoly of truthfulness, impartiality,
and objectivity is negated. On the contrary, many different theoretical perspectives can

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510 Review of Radical Political Economics / Fall 2006

exist within economic science, depending on different ethical (value) judgments. There
are, however, no specific criteria for judging the truthfulness of each theory. In addition,
the social construction of the subjects is equally relativized and understood in mere polit-
ical terms. Whereas Marxism recognizes the social construction of subjects but bases this
construction on the social division of labor and class structure, for postmodernists this
“imperialism” of economics—and even more of the sphere of production—is unaccept-
able. Instead, they choose more fluid, short-term, and relativist referents that enable the
acclaimed open-endedness and indeterminacy of their theory. Postmodernists override the
scientific boundaries but without transforming their interrelationship. Politics is added
rather than organically linked to economics. The only major change is that both are dis-
cursively understood. In the cases in which an extradiscursive is used, this is usually for a
theory of power generated not by material socioeconomic relations (as in Marxism) but by
the inherent nature and desires of humankind (e.g., Foucault).
Samuels (1996) provided a representative account of this perspective. Although he did
not reject the importance of truth (1996: 114), he posited that the social construction of
truth leads to a multiplicity rather than homogeneity of truth (1996: 115). Therefore, all
epistemological, ontological, and theoretical positions are functional with regard to the
reconstruction of extant reality. This reconstruction is almost solely a discursive matter;
hence, vast opportunities for selective perception exist (1996: 117). These arguments hold
even more forcefully in social sciences, which are systems of belief and modes of dis-
course and not solely epistemological phenomena (Samuels 1991: 516). The social con-
struction of knowledge-belief (the control of language), in return, organizes the control of
the definition of reality. Consequently, it has an inexorable political nature (1991: 517).
This is indicative of how Samuels understood political nature: it is when the mode of dis-
course (i.e., selective perception) is combined with hierarchical social structures (1991:
519). The prioritization of the characteristic “hierarchical” is telling. Politics is understood
as mere struggle for power and hierarchy. This struggle is autonomized from the economy
and even superimposed on the latter.

4. Postmodernism and Neoclassical Economics

Postmodernist inroads in economics coincide, broadly, with a new trend in neoclassi-

cal economics. Fine (2000) has branded this trend “economics’ imperialism”. He has
shown convincingly that during the recent decades, neoclassical economics moves beyond
its traditional fields and invades previously no-go areas. This holds both within economic
theory (with neoclassical economics making bold inroads in areas such as development
economics) and within social sciences in general (as methodological individualism and
orthodox economics’ quantitative techniques are being spread widely). The crux of this
movement is that neoclassical economics ceases to neglect the social dimension and
attempts to tackle it from within its perspective. Indeed, the reason for the increasing suc-
cess of orthodox economics’ imperialism is that it has endogenized the social as nonmar-
ket responses to market imperfections. Social aspects that were previously considered
alien to neoclassical analysis (such as institutions, habits, and cultural phenomena) are
now analyzed by using the neoclassical microeconomics’s toolbox. Beginning with human

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 Mavroudeas / Contemporary Political Economy and Postmodernism 511

capital theory, and following with neoclassical institutionalism, information economics,

and so on, this imperialism gained momentum.
Neoclassical imperialism has possibly direct and indirect relations with postmodernist
inroads. Fine (2000) argued that postmodernist excesses (with their undue emphasis on
subjectivity and the neglect of objectivity) created—as a reaction—a reinvigoration of
interest in the material conditions (of which the economic is a crucial one); neoclassicism
is exploiting this interest.
In my opinion, the picture is far more complex. Capitalism’s structural crisis of the
1970s opened a prolonged period of restructuring. After almost three decades of restruc-
turing, however—and despite significant gains by capital against labor—the system has
not yet achieved long-term momentum, let alone a new “Golden Age.” Much of this inabil-
ity is due to the inefficiency of orthodox theory to tackle economic problems as social
problems. Thus, neoclassical economic imperialism is a sign of both strength and weak-
ness. Orthodox theory, by moving into terra incognita, risks its own cohesion and opens
dangerous floodgates. The orthodox economics’ troubles stem from the contradiction
between the recognition of the social dimension of the economy—even in a distorted
microeconomic manner—and their inability to offer any relevant macroeconomic policy
that could alleviate social problems.
Postmodernist economics revolves around the issue pertaining to the social dimension.
The way in which this dimension is treated, however, leads it not to be a serious contender
against neoclassical precepts, but rather a shy interlocutor. Here, it should be pointed out
that postmodernist economics—with the exception of the newer, middle-range theories—
is a latecomer (compared with its intellectual cousins in other fields), and thus it followed
chronologically the contemporary neoclassical onslaught.
Marxist political economy, in contrast, considers socioeconomic relations as an unsep-
arable whole, which is being fetishistically separated into the spheres of economics and
politics in bourgeois society. Within this unified whole, socioeconomic relations (i.e., the
moment of production and its subsequent moments of circulation/exchange and distribu-
tion) create the social wealth and secure the material reproduction of society. They, there-
fore, have a determining primacy over nonproductive spheres of social activities. The
nonproductive spheres, however, exert feedback influences on the socioeconomic rela-
tions. From this vantage point, the study of socioeconomic relations in production,
exchange, and distribution constitutes the basis on which the study of the rest of the
socioeconomic relations (ideological, political, etc.) should be studied. Thus, Marxism
studies economic relations in direct, but also with structured, connection to social and
political relations. Classical political economy adopts a similar perspective but in a weaker
form, given that it also studies economic relations as social relations.
On the contrary, the neoclassical perspective separates artificially “economic” rela-
tions from social and political relations. It considers as “economic” relations primarily
those activities that arise in exchange (i.e., market relations). Then, these “economic” rela-
tions are posited as the basis of the social and political relations, which are being studied
by other separate social science branches.
Postmodernism unjustly puts these two opposing perspectives on the same footing and
accuses both of economism. Moreover, it applies a discursive conception of the social
dimension that has little or no bearing on the material conditions of life. This, as has been

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512 Review of Radical Political Economics / Fall 2006

shown, is a superficial understanding of the social dimension by the postmodernists that

cannot seriously challenge the neoclassical perspective. In fact, postmodernist economics
has several covert links with its neoclassical counterpart.
First, curiously enough, they both consider theory as not “the appropriation of reality
by human thinking,” but as a mere ad hoc and unrealistic simulation of reality. Neoclassical
theory focuses on its positive economics and banishes normative economics to some dis-
tant corner of economic analysis. But its positive economics is studied via the “as if”
methodology; theory is a mere instrument for understanding and predicting reality, but its
tools are idealistic. Thus, although assumptions can be decidedly false, the explanation that
follows is deemed realistic (Friedman 1953). Postmodernism, however, considers all
theory normative (without any serious gearing on objective conditions) and thus makes it
a subjective discursive narrative about the economy. Neoclassical economics artificially
divorces objectivity from subjectivity and exiles subjectivity, whereas postmodernism arti-
ficially conflates the objective with the subjective (and, in its more extreme versions,
rejects even the existence of the former) and attributes primacy to subjectivity. They both
end up with nonrealist theory.
Second, individualism is the vehicle through which both organize their theories.
Neoclassical economics ascribes explicitly to methodological individualism. Many philo-
sophical postmodernist theories also resort explicitly to methodological individualism, as
was already explained. The majority of postmodernist economists, however, use a middle-
of-the-road version: institutional individualism (Agassi 1975; Boland 1982). The institu-
tionalist inclination of most of them certainly facilitates its adoption. This version of
individualism departs from typical methodological individualism, which claimed that all
social phenomena are simply the sum of the actions of the individual agents operating in
society. It recognizes that institutions and society also affect the individual’s actions. On
one hand, individuals are the basic analytical unit. On the other hand, institutions do have
something more than being simply the sum of the actions of their constituent individuals.
There is, however, no structural hierarchy in this interrelationship. It cannot be, in princi-
ple, defined whether individuals or institutions come first. In each specific case, there is a
special process of interaction that gives rise to it. To put it differently, structure and agency
affect each other reciprocally without one being prior to the other—at least in principle.
Toboso (2001), offering it as a truly middle-of-the-road explanation that can unite both
traditional and neoclassical institutionalists, summarized it as follows:
1. Individuals are the main agents.
2. Institutions exist and influence individuals.
3. Change takes place via individuals.

The reciprocality-without-causality between structure and individual is certainly some-

thing that sounds pleasant to postmodernists. This conception of institutions, habits, and
collective relations is, however, to say the least, ambiguous and problematic. It cannot
define properly how all these arise because it cannot propose a direction of causality. In
the last instance, everything hinges on the individual. Therefore, it is a version of individ-
ualism, and the classical critique of this approach applies to it as well.
In sum, it can be said that postmodernist economics—instead of confronting frontally
the neoclassical orthodoxy—agrees with it on certain crucial issues. In this sense, it is a
byproduct of neoclassical economic imperialism.

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 Mavroudeas / Contemporary Political Economy and Postmodernism 513

5. A Political Genealogy of Political Economy?

Meuret’s (1988) “political genealogy of political economy” is an interesting attempt to

propose a postmodernist interpretation of the birth and establishment of political economy.
Meuret’s framework is based on a combination of Foucault’s theory of knowledge (as a
program of truth but without calling into question its actual truthfulness) and the Annales’s
economic historiography. His main thesis is that political economy became the dominant
discourse because it constructed a better political framework for the coexistence of capi-
tal, state, and those trying to protect themselves from their power. Thus, the reasons for the
emergence of political economy are to be found in the field of the political rather than that
of the economic. It is indicative that for Meuret, the final crisis of the ancien regime (i.e.,
the last stage of the feudal system) was caused mainly by political reasons, and particu-
larly political ideological and discursive factors.
Meuret began his essay by adopting Foucault’s “savoir” and Veyne’s “program of truth”
perspective, within which a theory is posited as a discourse autonomized from and nonde-
termined by other spheres of social activities. Therefore, a particular theoretical discourse
should not lay claim to truthfulness. The very term genealogy, used by Meuret, denotes that
his account of the construction and establishment of political economy does not pose the
claim of truthfulness. Then, the habitual postmodernist jargon of discourse (i.e., representa-
tions, utterances, and rhetoric) is used in his study (Meuret 1988: 241). A major element of
his analysis is the way in which political theories and economic representations are linked.
He argued that economic and political representations stand on an equal par and reciprocally
determine how men agree on a common perception of the world to inhabit it together. The
question is why these—or only these two—fields of discursive representation exist.
His second theoretical pillar is his definitional framework and the subsequent histori-
cal account of the evolution of modern societies. Both these elements are adopted from the
Annales school. He defined, following Braudel, three major actors: capitalism, the state,
and the public.
For Meuret (1988: 227), capitalism is not understood as a mode of production
(founded on the private ownership of the means of production and the subsequent trans-
formation of labor power to a commodity). It is rather “that economic organization in
which the indispensable exchange of necessary commodities is organized on the basis of
the very minimum of necessary regulations.” Capitalism’s actors are all those—merchants,
industrialists, landowners—“who conduct themselves according to its rules, who play its
game” (1988: 227). This definition of capitalism confines it to a mere mode of exchange
relations (market). This understanding has critical consequences in Meuret’s analysis. In
addition, there is nothing to explain why these three actors—which correspond to the three
of the four basic fractions of capital (merchant, industrial, landowning, money capital)—
are his sole active subjects.
Then, the economy is defined as “sometimes all the exchanges of a given society,
sometimes that part which remains outside the capitalist game” (Meuret 1988: 227).
Again, here the economy appears mainly as an organization of exchange. If there are any
noncapitalist (nonmarket) elements, in Meuret’s terms, these cannot be explained because
the economy is confined to exchange relations and production is absent.
The state is taken as an almost self-defined concept. This conception, also, fails to
grasp the state as a derivative of the socioeconomic organization and not as a primary

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514 Review of Radical Political Economics / Fall 2006

agent. Consequently, it fails also to understand the changes in the nature of state from one
socioeconomic system to the other. In his analysis, for instance, Meuret could not distin-
guish between the absolutist state of the last era of feudalism and the capitalist state.
Finally, the public is defined as

all citizens with the power to repudiate the state to the extent that they exercise this
power. . . . It is not a sociological but a political reality: a set of opinions, attitudes and
propositions, of tacit resistances and acceptances which do or do not allow a governmen-
tal apparatus to function. (Meuret 1988: 228)

Again, this term is highly problematic. The notion of citizen has a different content under
different socioeconomic systems (e.g., in a slave-owning city-state or in capitalism).
Furthermore, it limits opinions and struggles only to those in relation to the state. There
are no relations of struggle within the socioeconomic structure, even if these are consid-
ered of equal validity to those in relation to the state.
Meuret’s definitions fail to understand politics and political power as a truly social
process. In addition, he failed to relate them to the problems of production and distribution
of social wealth. This failure derives from both the neglect of the sphere of production (and
the socioeconomic relations of production) and the subsequent rejection of the concept of
social classes (defined on the basis of the socioeconomic relations of production). The
result is a more or less open recourse to methodological individualism: “men agree on a
way of perceiving the world in order to inhabit it together, economically and politically”
(1988: 228). Moreover, his historical account of the development of modern (capitalist)
economies fails to distinguish rigorously from the preceding ancien regime and also can-
not explain the conflictual process of development of capitalism from within this regime.
A final point is necessary with regard to the adoption within Meuret’s postmodernist
account of the Annales’s historical and definitional framework. The Annales school, or the
new French history, dominated the French intellectual scene for quite a long time from its
emergence in 1929, and it continues to have an imposing presence. Its linkage to post-
modernism sounds curious enough because it has been known for its emphasis on struc-
tures rather than agents. It focuses on the economic background of history instead of
political events, and it pursues an interdisciplinary approach, transcending the boundaries
among the social science branches. Especially Duby and Braudel emphasized the peren-
nial character of the heavy structures (“structures lourdes”). The impact of these structures
is expressed through the norms levied on daily life that confine the space of liberty allowed
for initiatives to individuals and groups.
The Annales, however, passed through several phases of evolution.8 It is its second
period, which began after the Second World War and revolved around Braudel’s works,
which emphasize structure. The theses of its first period (expressed in the works of Bloch
and Febvre) came under attack by the then-predominant structuralists. Braudel responded
to this attack by incorporating part of the structuralist project. The concept of structure was
appropriated, if not as a conceptual framework, then at least as a descriptive notion. The
structure was seen as embodied in the beginning of a period of long duration. In Braudel’s
(1985) words, “[H]istorical structures are visible, detectable, and to a certain extent

8. For a presentation and also critique of the school of Annales, see Dosse (1986).

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 Mavroudeas / Contemporary Political Economy and Postmodernism 515

measurable: duration is their measure.” Thus, there was a shift to a historical approach that
privileged long duration and undermined specific events.
Meuret adopted from the Annales’s perspective (1) the interdisciplinary framework,
and (2) its terminology. He discarded, however, its emphasis on economic relations and the
structuralism of the second period.
It is in this context that Meuret advanced his political genealogy and maintained that
the reasons for the emergence of political economy are to be found in the field of the polit-
ical. He defined political economy as a discourse and, moreover, as the governmental dis-
course of the modern world (1988: 227) because it was able to construct a superior
political framework for the coexistence of capital, state, and those who are trying to pro-
tect themselves from their power. For Meuret, Adam Smith provided its exemplary ver-
sion. Political economy, however, prevailed over other contenders—such as political
theory or other preclassical economic theories—not because of its analytical superiority,
but because of a particular event: the Industrial Revolution (1988: 247). In other words, the
predominance of political economy over other discourses derives not from its truthfulness
but from its programmatic value (as a prescription for actions) in relation to external
events. This is a clear-cut postmodernist argument, which fails to explain why this crucial
external referent—the Industrial Revolution—has taken place. If the latter was a necessary
feature of capitalism, as Marx thought, this creates problems for Meuret’s productionless
understanding of capitalism.
Meuret proposed a four-phase periodization of the political genealogy of political
economy, which is founded on the relation between representations of the economy and
their congruence with the political system:

1. The period of absolutism (until 1680), when the state is accepted as the legitimate regulator of market
activities to guarantee people’s happiness and the state’s strength.
2. Absolutism’s crisis of legitimacy of the state (the eighteenth century), which is attributed to political
reasons.
3. Eighteenth-century preclassical search (physiocrats, etc.) for a redefinition of the role and legitimacy
of the state.
4. Smith’s invention of the discourse of political economy, in which the state and market relations are
equally domesticated (in the sense that they are mutually defined on a national [domestic] basis and
their respective functions are clearly defined). The market operates under minimum regulations and
is solely responsible for social wealth, and the state supervises and guarantees its functions.9

Meuret’s account is based on political and historically accidental factors, plus the pri-
macy of the discursive elements. There is a marked lack of any reference to classes and
social relations of production, which creates significant explanatory problems, as already
explained. For example, the era of mercantilism—as the transition period when one ele-
ment of the feudal system (the state of absolute monarchy) allied with the precursors of
capitalism (merchant capital) to overcome the feudal socioeconomic fragmentation—loses
any significance. It is treated as a mere historical accident and not as a historically neces-
sary stage. In addition, its crisis is attributed solely to political causes. It cannot be under-
stood as the end of a period that came when the old system (feudalism) was definitely dead
and one of its allied victors (capitalists)—for socioeconomic reasons—prevailed over its

9. Meuret recognized correctly that for Smith the state has a role in the economy.

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516 Review of Radical Political Economics / Fall 2006

ally (absolute monarchy). Equally, political economy is understood merely as the redefin-
ition of the modus operandi of the state and market. Crucial elements of Smith’s theory
(e.g., value theory, the role of the division of labor, and the problem of the source of social
wealth) appear to play no role. For the same reasons, David Ricardo—who offered the
most coherent version of classical political economy, and who paid less attention to philo-
sophical and political problems and focused on a production-based value theory—has no
place at all in Meuret’s account.
On the contrary, the Marxist approach—by deriving the creation of theories and sci-
ences from material socioeconomic relations—offers a better understanding of the con-
struction of political economy. In a nutshell, it shows that the need for an autonomous
science of economic relations was neither a chance event nor a mere theoretical invention.
It was the emergence of a new socioeconomic system (capitalism) and its specific features
that created this need (contrarily to previous systems that did not require such a science).
Also, Marxism answers convincingly (1) why the first version of a science of economic
relations took the form of classical political economy, and (2) why political economy
retreated and economics took its place as the dominant version of a science of economic
relations. The comparative advantage of the Marxist perspective is that it comprehends
properly that socioeconomic material reality—indirectly and through complex mediations—
ultimately guides the creation and predominance of theories.

6. Conclusions

Postmodernist economics proclaims itself as a newcomer that confronts all the previ-
ous “modernist” economic traditions and offers a radically different economic approach.
Postmodernism artificially lumps all the existing schools of thought together and projects
itself as a true beacon of revolutionary change in economics. In the article, it has been
argued that this is an exaggerated claim that cannot stand up under close scrutiny.
Postmodernist economics is not only a by-product of the contemporary neoclassical
onslaught within economics but also the reflection of its “imperialism” within social sci-
ences in general. Instead of confronting the orthodoxy, postmodernism reproduces crucial
orthodox theses either directly or covertly as the opposite side of the same coin. Most
notably, postmodernism—by understanding the social dimension simply as discourse and
by deliberately neglecting the material conditions—helps neoclassical economics to fur-
ther its dominance, because the latter can account (however unsatisfactorily) for these
material conditions. Postmodernist economics acts like the “king’s parliamentary opposi-
tion”: it offers a vociferous critique without being either willing or able to overturn the
regime. Moreover, the way in which postmodernist economics theorizes the social—via
recourse to institutionalist individualism—encompasses significant affinities with neoclas-
sical economic imperialism. In the end, individuals are the primary agents, either for post-
modernist discursive subjectivity or for neoclassical economic subjectivity.
Consequently, postmodernist attempts at rewriting the history of economic theory in
general (and the history of political economy in particular) are in serious error. As has been
shown in the critique of Meuret’s political genealogy of political economy, even “worldly
poststructuralist” approaches—let alone pure textualism—cannot explain satisfactorily
political economy’s process of creation. Also, more generally, contrary to Screpanti’s

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 Mavroudeas / Contemporary Political Economy and Postmodernism 517

claim, postmodernism does not represent a radical rupture in the evolution of economic
theory. The grand divide is not between postmodernism and so-called modernist econom-
ics, but between political economy (i.e., classical and especially Marxist) and neoclassical
economics. Postmodernist economics stands, at best, somewhere in the middle.

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Stavros D. Mavroudeas is associate professor of political economy at the University of Macedonia. He

received his PhD from Birkbeck College, University of London, 1990. His teaching and research fields include
political economy, history of economic thought, and development economics. His publications include “Forms
of Existence of Abstract Labour and Value-Form”; “Regulation Theory: The Road from Creative Marxism to
Post-modern Disintegration”; “Periodising Capitalism: Problems and Method—The Case of the Regulation
Approach”; “Commodities, Workers, and Institutions: Analytical and Empirical Problems in Regulation’s
Consumption Theory”; and “The Monetary Equivalent of Labour and Certain Issues regarding Money and the
Value of Labour-Power.”

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