The great wheel of wealth: A reflection of social reciprocity
Hamilton rejects Karl Polanyi’s assertion that modern industrial capitalism differs from all preceding forms of economies by being organized on the market principle rather than reciprocity. Hamilton defines reciprocity, drawing from the work of cultural anthropologists, most notably Bronislaw Malinowski, as meaning that “everything done by one person to favor another must be reciprocated by the latter.” Hamilton notes that the anthropologists are drawn to the more spectacular manifestations of this form of economic organization, such as the Kula exchange of arm shells and necklaces described by Malinowski. But Hamilton also discusses the trade in other, mundane goods that goes on simultaneously with the primary exchange of symbolically important goods. From this Hamilton notes that the symbolically important goods are part of a ceremonial exchange that reinforces social solidarity. The trade and barter in mundane goods is a manifestation of the technological interdependence among the people engaged in reciprocal exchange, based on division of labor and specialization of different groups in the employment of specific tool skills to produce useful items. Hamilton observes that the ceremonial aspect of reciprocal exchange is reduced, but not eliminated, in modern industrial culture. The technological exchange of goods and services that represent division of labor and specialization in our culture is accompanied by a reflected set of ceremonial financial exchanges employing money – a formal mechanism for authenticating exchange in our culture. The technological movement is shown by the flow of goods and labor between households and firms. The ceremonial movement is represented by the flow of money in the opposite direction; said pecuniary flow inscribes ownership, power and status relations in our society. All these flows take place in a great wheel of wealth, now usually depicted in the economics manuals as a circular flow diagram. Again Hamilton uses anthropology to illustrate the importance of culture in understanding economic systems.