Question

How does a sociological perspective on market structure differ from an economist's perspective?

Answer 1

Adam Smith in his book The Wealth of Nation and other thinkers developed the ideas of modern economics. Smith argued that market economy is made up of a series of individual exchanges or transactions, which automatically create a functioning and ordered system.This happens even though none of the individuals involved in the millions of transactions had intended to create a system. Modern economics is based on the Idea that the economy can be studies as a separate part of society that operates according to its own laws, leaving out the larger social or political context in which market functions.On the other hand, sociologist have tried to develop an alternative way of studying economic institutions and processes within the larger social framework.In this way, ; sociologists consider markets as social institution which are made in culturally specific ways.Sociologists maintain that economics are socially 'embedded' .