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Grassroots economics: Meaning, project and practice in the pursuit of livelihood

Final Report Summary - GRECO (Grassroots economics: Meaning, project and practice in the pursuit of livelihood.)

The summary should be a stand-alone description of the project and its outcomes. This text should be as concise as possible and suitable for dissemination to non specialist audiences. Please notice that this summary will be published.
Our project proposes a bottom-up approach to economic dynamics. It seeks to understand the effects of the economic crisis and of structural adjustment policies in the livelihoods of Southern European working people. Four Southern European countries –Portugal, Italy, Greece and Spain— were strategically selected as research sites due to their relevance in the current crisis.
Economists and policy makers provided analyses and advised on political action to end the economic crisis, but this resulted in greater precarity and inequality producing social protest as well as nationalistic and xenophobic reactions. The ‘technical’ models that informed these policies showed little grounded knowledge about how real people make decisions within social and cultural environments that set the framework for their actions. The Grassroots Economics project proposes a major shift in perspective in the understanding of economic processes. This project takes into account the models and theories about economic processes that ordinary people develop through reflecting on their experiences and evaluating their opportunities against the backdrop of state policies and expert discourses that saturate the social field. Research questions are based on the premise that we need to understand how ordinary people’s projects and those of the economic elites and institutional power holders are co-determined. By acknowledging grassroots economics and comparing it with expert models of the economy new theoretical ground is opened. It will hopefully shed light on present-day economic insecurity affecting the stability of European political communities.
Research conclusions include:
(1) Regulatory frameworks are differentiated as legal and legitimate, and these do not always coincide. The economic crisis and ensuing austerity measures have created a widening gap between these two frameworks in the understanding of ordinary people that suffer from decreasing opportunities and expectations.
(2) Regulatory frameworks, both legal and legitimate, based on political or moral sanction, often overlap and have a different effect and value at different scales. While some regulations make sense at the macro scale (e.g. the legality and need of taxation to support public goods), they do not make sense at a micro scale especially when they challenge everyday livelihood and endanger social reproduction.
(3) In the context of decreasing resources and expectations, individuals, households, and social networks resort to solidarity and lack of solidarity, to inclusionary and exclusionary practices and arguments of access (deservingness). With time, trust becomes a rare quality –a limited good— leading to seclusion into the household and trust only in intimate filial links, a situation that raises inter-generational conflict.
(4) Breach of trust at the scale of relations with the state and at the scale of proximate relations is connected with a breakdown of self-worth: “social recognition” patterns become volatile, moral economies are unstable, reciprocity links and obligations are extremely weak (hence return to family). As a result material transfers become also unstable and finite.
(5) “Trust in the future” as a personal and inter-generational avenue of progress collapses. Temporality is reversed: people feel they are going back towards a past of greater deprivation, inequality, political dependency.
(6) The analysis of our ethnographic and documentary material show overlaps of value regimes, that is, category grids that are attached to different orders of meaning (e.g. human worth, economic value, political rights, moral obligations, etc.). Value regimes are subject to valuation processes were convergences, contrasts, conflicts and struggles over categories and values take place.
(7) Our observation and analysis show a continuous co-dependency between everyday micro-practices and larger trends in economic processes. Behavior and lay discursive frameworks justified on the basis of shared experience on the one hand; and expert categories of analysis and theoretical constructs on the other, have to be articulated in a synthetic model.
In sum, our research proposes to capture and embrace the epistemological tension existing between observed behavior and lay discursive frameworks justified on the basis of shared experience on the one hand; and expert categories of analysis and theoretical constructs on the other. The model we propose develops the concepts of “factual truth” (Arendt) and “social facts” (Durkheim) as necessarily articulated for explaining economic processes. Factual truth, based on the force of experience (concrete, subjective) as a motive for understanding, reasoning, and mobilization both contrasts and complements the statistical trends (abstract, objective) of data categories and aggregate individual action of social facts. The model we propose, moreover, does not take individual actor decision making and choice as the starting element of economic processes. Rather, while retaining human agency and responsibility as the fundamental dynamic factor, we propose to think of a distributed social actor, with “dividual” responsibilities (not only plural but distributed among a network of actors). In conclusion, the theoretical model we present generates new knowledge from the tension between factual truth and social facts.