COMPETING ECONOMIC IDEOLOGIES IN SOUTH-AFRICA ECONOMIC DEBATE

This paper develops an analytical framework for the sociological analy sis of the clash of economic ideologies. The framework is then used to make sense of the economic debate in South Africa in the 1990s. The a rgument is that, following Karl Polanyi, we must treat economic life a s 'embedded' in social life; that is, economic action is a form of soc ial action. However, the notion of 'embeddedness' must not blind us to the tendency in all economies, especially contemporary market economi es, for economic motivations to become differentiated from the rest of our lives. Accordingly, the framework developed through a critique of key assumptions of neo-classical economic theory attends to both the embeddedness and the differentiation of the economic element. Having e stablished a framework of analysis, I apply it to the debate in South Africa about the most relevant framework for economic policy in the po st-Apartheid economy. The article traces the gradual move of the Afric an National Congress (ANC) away from statist economics to a much more market-oriented policy and shows how this reflects the ANC leaders nee d to balance the demands of their constituency's (embedded) conception of rationality against the potential investor's more mainstream conce ption of economic rationality, which is itself embedded in prosperous communities with property and skills. A similar analysis is applied to the development of the economic policy of the ANC's rival, the former ruling National Party (NP). The NP advocates an economic policy frame work based on an individual self-reliance and 'free' markets, that is, on an individualistic calculative rationality similar to that of the neoclassical textbooks. However, the NP too has to pursue politics and they, although rather differently from the ANC, have sought to reconc ile individual maximizing rationality with the collective rationalitie s of the oppressed black communities in order to win maximum support.