This chapter discusses the six standards of a good market theory. A good market theory must be able to explain how humanity can cooperate in the extended order based on division of labor. It must explain how the reputation mechanism works in promoting human cooperation. A good market theory should be a theory about how the economy develops and changes, not only a theory about how the market reaches equilibrium and stability. Entrepreneurship is the soul of the market economy. Without entrepreneurs, a true orderly market is not possible, and neither is true progress. A good market theory must be able to explain economic fluctuations and business cycles. Economic fluctuations and business cycles are related to entrepreneurial decisions and innovations. A good market theory should be of rights-priority (putting rights above interests) rather than utilitarian (putting interests above rights). In terms of all these standards, neoclassical economics is not a good theory of the market.

This chapter revisits Thomas Kuhn’s argument about an essential tension between tradition and innovation as a driver of scientific progress. It shows that Kuhn’s argument builds on a number of assumptions about the practices of science that held for past science conducted by individuals working within isolated disciplines, and argues that it does therefore not necessarily hold for the increasingly collaborative and interdisciplinary science we see today. Examining different types of organization into teams, the chapter discusses how changes in the granularity of collaboration affect Kuhn’s essential tension argument.

Chapter 5 is about the economic dimensions of premodern cities. After a discussion of economic growth, the chapter contrasts commercial and command economies and discusses urban craft specialization and the division of labor as well as regional and international exchange systems.

Chapter 5 examines Plato's account of the "fevered" polis in exploring the thesis that societies are to be understood as composed of parts well suited to carry out specific functions and that it is primarily in this respect that they resemble biological organisms. Thus, in the healthy polis each part carries out the specific function appropriate to it, and functions are coordinated such that all are well executed and society's essential needs satisfied. From Plato we learn that a defensible account of social pathology embraces a weak holism, according to which "ill" may apply to society as a whole without any part of it being ill (since it is institutions or societies that are dysfunctional, not individuals). At the same time, it eschews strong a normative holism that holds that things can be good or bad for societies without them also being good or bad for individual members.

Chapter 8 examines and partially defends Durkheim's functionalism as practiced in The Division of Labor in Society. His position is reconstructed with an eye to determining which aspects are worth retaining for a contemporary theory of social pathology, including the functionally organized nature of society. Focusing on claims regarding the moral function of the division of labor, it examines epistemological issues bound up with ascribing functions to features of society, including the relation between functional explanation and functional analysis and the role played by historical narratives. Durkheim's method is a complex holism whose claims depend less on single facts and individual arguments than on the plausibility of the whole picture that emerges from mutually reinforcing arguments, empirical facts, interpretive suggestions, and analogies. Thus, Durkheim's method for ascribing functions to social phenomena bears similarities to other interpretive enterprises, from the reading of texts to the construction of theories in the natural sciences.

Chapter 7 treats two philosophers who directly influenced Durkheim: Auguste Comte and Herbert Spencer. Looking at their use of the society–organism analogy, their versions of functional explanation and functional analysis, and their conceptions of what a scientific sociology must be like helps one to understand both the content of Durkheim's positions and why he held them. Three types of functional explanation employed by Comte are relevant: two forms of existential functional explanation as well as functional analysis, which makes no claims regarding the existence of what it analyzes but "explains" what it is by specifying the function it serves and showing how its features are suited to accomplishing that purpose without implying anything about how it originated or why it persists. The chapter argues that Comte and Spencer rely too heavily on the society–organism analogy, leading to an overly biologistic understanding of normative critique available to social pathologists.

The market in ancient Greece should be understood as a specific institutional construct, that of the city-state, which allowed its citizens to exercise private property rights guaranteed by law. By extension, free foreigners were also acknowledged these rights, which however extended to the private ownership of human beings (slavery). The city-state also created the conditions for an unusually high division of labour. Each city was a market space of its own, with its own rules and logic, which could include the control over sales margins and even sometimes the establishment of maximum prices for some perishable fresh goods. The network of hundreds of Greek city-states also created the conditions for the development of an original form of international market.

The chapter covers the history of the work-life balance movement – how industrialization and division of labor along gender lines reinforced segregation between work life and family life. To set the stage to understand the psychology of life balance, the chapter also introduces basic concepts of wellbeing.

Many thinkers have alleged that free markets are inimical to a sense of community. According to critics such as Robert Putnam, commercial societies tend to dissociate people from one another and to undermine the basis of civil society. Alexis de Tocqueville’s Democracy in America seems to present a challenge to this view insofar as he regards the Americans as both exceptionally commercial and uniquely associational. If markets and associations are in tension with one another, how can they coexist in the United States? As Rachael K. Behr and Virgil Henry Storr argue in this chapter, a closer attention to Democracy in America suggests several ways in which commercial society and the spirit of association are mutually supportive. Markets foster a complex division of labor that requires mutual cooperation. Markets encourage a sense of enlightened self-interest that teaches citizens how they might engage with one another in mutually beneficial ways. Further, markets facilitate innovations in communication that make it easier for citizens to coordinate and freely associate for political change. Rather than giving rise to Tocqueville’s dreaded pathology of “individualism,” as critics have alleged, markets are instead conducive to active civic engagement and the free association of democratic citizens.

This article illustrates how contemporary Durkheim studies offer a corrective to previous misinterpretations. They stress the significance of his work for subsequent developments in cultural sociology and his contribution to our understanding of solidarity, which has informed recent developments in civil society theorizing.

Peter Kivisto is the Richard A. Swanson Professor of Social Thought at Augustana College and International Reader at the University of Helsinki’s Center for Research on Ethnic Relations and Nationalism (CEREN). He is the author or editor of 37 books and over 180 articles and book chapters.