Mark Blyth argues that economic ideas are powerful political tools as used by domestic groups in order to effect change since whoever defines what the economy is, what is wrong with it, and what would improve it, has a profound political resource in their possession. Blyth analyzes the 1930s and 1970s, two periods of deep-seated institutional change that characterized the twentieth century. Viewing both periods of change as part of the same dynamic, Blyth argues that the 1930s labor reacted against the exigencies of the market and demanded state action to mitigate the market's effects by "embedding liberalism" and the 1970s, those who benefited least from such "embedding" institutions, namely business, reacted against these constraints and sought to overturn that institutional order. In Great Transformations, Blyth demonstrates the critical role economic ideas played in making institutional change possible and he rethinks the relationship between uncertainty, ideas, and interests on how, and under what conditions, institutional change takes place.Mark Blyth is an assistant professor of political science at the Johns Hopkins University specializing in comparative political economy. He has taught at Columbia University, and at the University of Birmingham, UK. Blyth is a member of the editorial board of the Review of International Political Economy.

Arguing that economic ideas are crucial elements in the construction and transformation of political institutions, Blyth (political science, Johns Hopkins U.) examines how the 1930s and the 1970s both witnessed the power of economic ideas to fundamentally alter political dynamics, the first time in favor of labor and the second in favor of capital. His analysis is presented as a antidote to what he sees as the traditional tautologies that posit that people support policies based solely on their perceived common interests, whether in the real world those policies benefit them or not. Blyth's work owes a large intellectual debt to the work of Karl Polanyi, specifically his idea of "embedded liberalism," but he critiques Polanyi as having fallen prey to the myth of permanent change.
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"[R]emarkably rigorous, original, and interesting work.... Blyth breaks new ground by using Frank Knight's concept of uncertainty as a linchpin for this theory of institutional change.... Highly recommended." Choice"Economic historians frequently fail to connect their findings to broader political and sociological questions. Mark Blyth, a professor of political science at Johns Hopkins University, avoids that pitfall in Great Transformations. In a well-researched comparative study of the United States and Sweden, Blyth analyzes the impact of economic ideas on institutional change." History: Reviews of New Books"Blyth's analysis is sweeping, thorough, and powerfully demonstrates the path-shaping power of ideas to frame and give substance to institutional reconfiguration." Governance"Blyth's analysis is sweeping, thorough, and powerfully demonstrates the path-shaping power of ideas to frame and give substance to institutional reconfiguration." Governance"[An] important new book." EH.NET

This book analyses political and economic change in the twentieth century through an examination of institutional change in the United States and Sweden from the 1920s to the end of the 1990s. The key claim is that economic ideas are political tools used by domestic groups to effect change since whoever defines what the economy is, what is wrong with it, and what would improve it, has a profound political resource in their possession. Blyth demonstrates why this is the case and why economic ideas are so politically important.

This book picks up where Karl Polanyi's study of economic and political change left off. Building upon Polanyi's conception of the double movement, Blyth analyzes the two periods of deep seated institutional change that characterized the twentieth century: the 1930s and the 1970s. Blyth views both sets of changes as part of the same dynamic. In the 1930s labor reacted against the exigencies of the market and demanded state action to mitigate the market's effects by 'embedding liberalism.' In the 1970s, those who benefited least from such 'embedding' institutions, namely business, reacted against these constraints and sought to overturn that institutional order. Blyth demonstrates the critical role economic ideas played in making institutional change possible. Great Transformations rethinks the relationship between uncertainty, ideas, and interests, achieving profound new insights on how, and under what conditions, institutional change takes place.

An analysis of political power of economic ideas used by domestic groups to effect change.

Part I. Theory: 1. Karl Polanyi and institutional change; 2. A theory of institutional change; Part II. Cases: 3. Building American embedded liberalism; 4. Building Swedish embedded liberalism; 5. Disembedding liberalism: ideas to break a bargain; 6. Disembedding liberalism in the United States; 7. Disembedding liberalism in Sweden; Part III: 8. Conclusions.