Moral economy is a way of viewing economic activity in terms of its moral, rather than material, aspects. The concept was developed in 1971 by British Marxist social historian and political activist E. P. Thompson in his essay, "The Moral Economy of the English Crowd in the Eighteenth Century". He referred to a specific class struggle in a specific era, seen from the perspective of the poorest citizens—the "crowd".

History

According to Thompson, and of 19th century political economists. Bronterre wrote, "True political economy is like a true domestic economy; it does not consist solely in slaving and saving; there is a moral economy as well as political... These quacks would make wreck of the affections, in exchange for incessant production and accumulation... It is indeed the moral economy that they always keep out of sight. When they talk about the tendency of large masses of capital, and the division of labour, to increase production and cheapen commodities, they do not tell us of the inferior human being which a single and fixed occupation must produce." This "crowd" included "tinners, colliers, weavers, hosiery workers, and labouring people", regularly rioted against grain merchants and traders who raised their prices in lean years. The 1971 essay provided a description of the traditional feudal economy as "moral", in contrast to the "classical" (in the sense of an economy in which prices were determined by supply and demand). Thompson saw the "crowd" as active subjects, not passive objects.

He worked in the emerging discipline of social history, adopting the perspective of the crowd, rather than that of investors and business owners, crafting a "history from below" to explain why the crowd made the decision to riot. He concluded that they grieved the loss of their traditional livelihoods, facing hunger and/or starvation.

Thompson traced the root causes to the enclosure system that converted common lands into individually held plots, to merchants who raised prices in times of relative shortage, and to other practices that Thompson associated with freetrade, free markets, and limited regulation (laissez-faire) regulation that he identified with Adam Smith's 1776 book The Wealth of Nations.

Thompson explored how peasants' grievances reflected a popular consensus that economic activity should occur in accord with commonly held values. These included social norms, mutual obligations, and responsibilities. During industrialization, protective laws disappeared, and previously illegal activities became legal/common. Feudal peasants became industrial workers who experienced deprivation, and in extreme cases, starvation. Thompson said that the English riots were not just a response to physical hunger, but reflected public outrage against what rioters perceived to be the immorality of the new economic system.

Thompson re-defined and re-analyzed the concept. In the 1960s, he sided with the students in the student protests at his university, and in the 1980s, he was Europe's most well-known antinuclear activist.

Thompson's social history is associated with the phrase "history from below", like that of British social historians Raphael Samuel and Christopher Hill. Its antecedents were in Georges Lefebvre and the French Annales school. Previously, historians presented the peasants and working class "as one of the problems Government has had to handle".

In his 1964 book, The Crowd in History, George Rudé "explored the pattern of food riots and market disturbances in terms of their geographical distribution, frequency, level of violence". Thompson focused on the mindset of the 18th century crowd—used to the older, disintegrating economic system, which Thompson described as a moral economy—that paternalistically protected workers through crises and death, in return for authority over them. He contrasted this with the emerging system that broke that implicit compact.

Thompson investigated how in rural England in the 18th century, peasants made the decision to riot. He acknowledged that "riots were triggered off by soaring prices, by malpractices among dealers, or by hunger." However, he claimed that the riots were powered by the sense that old norms had been unjustly discarded and that the new ways were illegitimate, specifically referring to marketing, milling, and baking as examples. He defined the moral economy of the poor as "grounded upon a consistent traditional view of social norms and obligations, of the proper economic functions of several parties within the community." Thompson cited Bronterre O'Brien's 1837 usage, which was similar to Thompson's.

Thompson presented his work at an April 1966 conference. He described moral economy as a "traditional consensus of crowd rights that were swept away by market forces." Horwitz claimed that as markets for commodities developed in the second half of the 18th century, "the price of grain was no longer local, but regional; this [presupposed for the first time] the general use of money and a wide marketability of goods." in The Wealth of Nations. In this chapter Smith rejects the tax on corn exports, writing "The unlimited, unrestrained freedom of the corn trade, as it is the only effectual preventative of the miseries of a famine, so it is the best palliative of the inconveniences of a dearth; for the inconveniences of a real scarcity cannot be remedied, they can only be palliated." In England, poor laws and charity protected many from starvation in the 18th century. He said that, when the clergy condemned selling food at high prices or raising rents, it is possible that this influenced the behavior of Christians who were concerned about their reputations. He applied it in his 1976 publication The Moral Economy of the Peasant: Rebellion and Subsistence in Southeast Asia.

Scott, citing Polanyi, described how farmers, tenants, and laborers invoked "moral economies or market logic" and Eric R. Wolf, author of the 1969 Peasant Wars of the Twentieth Century.

In the chapter, "The 'Moral Economy' of the English Crowd: Myth and Reality" John Stevenson criticized Thompson and the other British scholars who, he claimed, followed the lead of the French Annales school-historians, shifting away from traditional historiography. In his 1975 book, Stevenson was critical of Thompson for his attempt to decode peasant culture in the context of social and economic change. He rejected Thompson's concept of moral economy based on what Thompson called "extraordinary deep-rooted pattern of behaviour and belief" which legitimised their protests against the "propertied and those in authority".

In the 1998 book Moral Economy, John P. Powelson wrote: "In a moral economy [an economy that is morally acceptable], with today's technology no one should be poor… The moral economy captures the benefits of technological invention through classic liberalism while using sidewise checks and balances to prevent environmental damage, ethnic and gender bias, and distorted distributions of wealth... In the moral economy, governments facilitate but rarely mandate." Such an economy maintains a balance between interventionism and libertarianism; between economic factors and ethical norms. Norbert Götz and Emilia Palonen have identified the affective dimension, parochialism, and disregard for third parties as key affinities between moral economy and populism.

Moral Economy Project

The Quaker Institute for the Future (QIF), established in 2003, launched the Moral Economy Project. The project expanded the term to incorporate environmental concerns. The project was based on Kenneth Boulding's 1966 article, "The economics of the coming spaceship earth". Boulding advocated for an integrated, holistic, ecological worldview. The related 2009 publication, Right Relationship: Building a Whole Earth Economy, claimed that the well-being of the planet requires a "whole earth economy", which they also called a moral economy.

  • Götz, Siméant-Germanos, and Sandberg (2015)
  • Götz and co-authors (2020)
  • Sandberg (2015)
  • Hodgson (2013),
  • Sayer (2000)
  • Heath (2001)
  • Kelly (2008)

Legacy

Thompson was described by Carlos Antonio Aguirre Rojas in 2020 as one of the "most important social thinkers of our age", whose work informed critical theory, alongside Karl Marx, Walter Benjamin, Fernand Braudel (who was highly influential in the Annales school), Mikhail Bakhtin, Carlo Ginzburg, and Immanuel Wallerstein.

In his 2017 book, The Moral Economists, Tim Rogan included Thompson in his trio of the 20th century's most influential critics of capitalism—along with Tawney and Polanyi because they were read widely, informed research, and influenced public opinion. All three were historians who challenged utilitarianism in economics as outsiders.