Half a century ago, economic research took a little-noticed yet dramatic departure from the study of concepts most people might be familiar with from Econ 101. The field shifted from an almost exclusive focus on market transactions and government policies to include societal interactions for which supply-and-demand models don’t work.
In a new Economics Letters paper, SFI Professor Samuel Bowles, along with SFI External Professor Wendy Carlin (University College London), and former SFI undergraduate research fellow Sahana Subramanyam (Stanford University), use a machine-learning technique to document this shift away from state-related topics toward a focus they term “civil society.”
The researchers explain that civil society encompasses a broad range of social structures, including firms as organizations, families, neighborhoods, NGOs, trade unions, social movements, and other face-to-face settings. In many ways, their work reflects a growing recognition that economic interactions are no longer confined to markets or governments. Instead, they are being shaped by the interplay between economic activities and the social fabric of civil society.
“This is a fabulous time to be studying economics,” says Subramanyam, now a doctoral candidate working with SFI External Professor Matt Jackson at Stanford. “Not only are civil society topics fascinating in their own right, but the conceptual tools to study them require us to go beyond the confines of the conventional textbook paradigm.”
For their analysis, the researchers used topic modeling to extract the 100 topics “most likely to have written” the text of the 27,436 papers published in leading journals since 1900. Then, they tracked the pattern of economic thought according to the topics making up three themes: markets, government, and civil society. Their analysis revealed that while state-related topics dominated early economic research, the focus shifted to markets by the 1960s. Since the 1970s, however, civil society has gained prominence, thanks to greater access to data and advances in game theory, behavioral economics, and other empirical tools.
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| This machine-learning-generated map illustrates the shifting content of economic research from 1900 to 2014. The dots and arrows track the increasing importance of market-related (and decline of state-related) topics between 1900 and 1970. Since 1970, civil-society topics account for a much greater weight in economic research. (image: adapted from Fig. 5 of Bowles et. al. 2024/Sahana Subramanyam) |
Though the term “civil society” is not used in economics today, its origins trace back to Adam Smith in the 18th century. Economic interactions within civil society often involve motivations beyond self-interest, emphasizing the importance of personal identity and ethical considerations. Unlike transactions in markets or state-regulated environments, these interactions rely on less formal but equally powerful mechanisms like social cohesion, trust, and shared norms rather than formal contracts or government enforcement.
Moving forward, the researchers intend to show how integrating the five decades of work by economists on civil society themes can contribute to solving many of the pressing problems we face. Progress in addressing climate change, growing inequality, and the future of work entails expanding beyond traditional models to include non-market interactions, the role of social norms and the exercise of power by private economic actors.
Read the paper "Civil society comes of age in economics: Tracking a century of research" in Economics Letters (Nov. 20, 2024) DOI: 10.1016/j.econlet.2024.112070
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"Civil society, beyond markets and states: Tracking 100 years of economic research," VoxEU, Nov. 25, 2024