ABSTRACT
What role does morality play for market outcomes? For most sociologists the functioning of markets is closely connected to the moral conduct of economic actors. This position is expressed, for instance, by the French sociologist Émile Durkheim (1984) who argued that purely self-interested behavior cannot produce stable exchange relations. Only through the “non contractual conditions of contract” do actors feel effectively bound to the contractual obligations they have agreed to. The moral code stops actors from exploiting their exchange partners through opportunistic behavior. This way morality supports the functioning of markets by reducing transaction costs. Another sociological classic – Max Weber (1984) – made morality a cornerstone in his explanation of macroeconomic development: for him the emergence of modern Western capitalism had an indispensable basis in the moral doctrines of Protestantism. Wolfgang Streeck (1997: 198) followed this idea by introducing the notion of “beneficial constraints,” meaning that the performance of an economy “may be improved by the surrounding society retaining and exercising a right for itself to interfere with the choice and pursuit of individual preferences.”
