The Impact of Functionalism, Conflict, and Interactionism Theories on the Economy
August 23, 2010
In modern society Sociologists employ three primary theoretical perspectives: the symbolic Interactionist perspective, the functionalist perspective, and the conflict perspective, which offer sociologists theoretical paradigms for explaining how society influences people, and how people influence society. Each perspective uniquely conceptualizes society’s social forces, and human behavior. Because the economy is an important element of society, sociologists are interested in how those segments of the political populace influence the economy.
The Interactionist theorist’s view of society is that they are active in influencing and affecting everyday social interaction. The key concepts are symbols, nonverbal communication and face to face interaction. The view of the individual is that people manipulate symbols and create their social worlds through interaction. Their view of social order is maintained by shared understanding of everyday behavior. The view of social change is reflected in people’s social position and a communication with others.
Interactionist norms are maintains through face to face interaction their values are defined and redefined through social interaction their culture and society’s core culture perpetuated to daily social interactions; their cultural variations, customs and traditions are transmitted through intergroup content and through the media. Interactionist theorists emphasize that our social behavior is conditioned by the roles and statuses we accept, the groups to which we belong ,and the institutions within which we functions Proponents were George Herbert Mead, Charles Horton Cooley, and Erving Goffman.
The Functionalist view of society is stable and integrated. The level of analysis emphasized is macro. Functionalists look at society as a social system. Structural functionalist believe everything is intertwined and interconnected for stability. They believe that institutions such as, school, church, racism, etc. exist to serve society and are therefore maintained by society. The key concepts of the functionalists are manifest functions, latent functions, dysfunctions. Their view of the individual is that people are socialized to perform societal functions. The view of the social order of the functionalist is maintained through social order. The view of social change of the functionalist is predictable, advocating reinforcing punishments for instance, to reinforce the social order. The norms from the functional perspectives, is to reinforce societal standards. Their values are collective conceptions of what is good. Cultural variations subcultures, serve the interests of subgroup groups. Functionalists believe ethnocentrism enforces global solidarity. Functionalists themselves have often invited severe criticism. The concepts of moving equilibrium and the hierarchically of ordered systems are rarely used, eliminating in most instances two of the four ways of studying change functionally (Cancian, F.1960)
Proponents of Functionalism were; Emile Durkheim, Talcott Parsons and Robert Merton.
Conflict Theorists Views
Conflict theorists view of society characterized by tension and struggle between groups. Level of analysis emphasized, is macro. Its key concepts are; inequality, capitalism, stratification, the view of the individual; people are shaped by power coercions and authority; it is a paradigm that emphasizes conflict and change as basic features of social life. Conflict theorists believe that society is held together by coercion. They look at the struggle for power in a society and believe things exist for those with power. In the conflict theorist’s view, social changes take place all the time and may have positive consequences. Conflict perspectives norms reinforce patterns of dominance; its values may have an effect on social inequality, culture and society, a society’s dominant ideology, and cultural variations. It questions the culture of the dominance and social order and feels ethnocentricity devalues groups. The proponents of conflict theory were Karl Marx, W. E. B. Dubois and Ida Wells Barnett.
All three majors groups play various important roles in politics sociological changes as well as in the economy. Economic sociology, particularly its neo-Weberian formulation, can be defined as a sociological theory of economic action (Zafirovski, M. 2001). Sociological perspective on the economy, economic rationality (maximization of utility, wealth, or profit) is not a parameter, as it is within conventional economics, but a variable, subject to variations over historical time and across societies (Zafirovski, Milan 2001). economic sociologists do not view economic contexts as separate from social and cultural contexts, but rather view them as reflective of and embedded within such contexts; economic sociologists view actor preferences and individual actions less as intact, calculated, and about maximizing utility more as ambiguous and affected by socially derived cognitive strategies, substantive rationality, feelings, roles, norms, myths, and expectations that form the basis for (Korczynski, M., Hodson, R, and Edwards, P. Eds. 2006).
In preindustrial societies land functioned as a source of virtually all wealth the industrial. Revolution changed all that it required that certain individuals and institutions are willing to take substantial risks in order to finance new inventions machinery and business enterprises. Essentially bankers’, industrialists, and other holders of large sums of money replaced land owners as the most powerful economic force, invested their funds in the hope of realizing even greater profits and thereby became owners of property and business firms.
In the transition to private ownership, business was accompanied by the emergence of the capitalist economic system. Capitalism is an economic system which the means of production dealt largely in private hands and the main incentive for economic activity is the accumulation of profits. In practice capitalist systems varying degrees to which the government regulates private ownership and economic activity. “Following the industrial revolution the prevailing form of capitalism was what is called laissez-faire (“let them do”)” (Schaefer, R.T.2009 p. 335).
Under the principle of laissez-faire, as expanded and endorsed by British economist Adam Smith (1723-1790), people could compete freely, with minimal government intervention with the economy. Business retained the right to regulate itself and operate essentially without fear of government interference (Schaefer, R.T.2009).
In preindustrial societies land functioned as a source of virtually all wealth the industrial revolution changed all that it required that certain individuals and institutions be willing to take substantial risks in order to finance new inventions machinery and business enterprises. Essentially banker’s industrialists other holders of large sums of money replaced land owners as the most powerful economic force. These people invested their funds in the hope of realizing even greater profits and thereby became owners of property and business firms.
The transition to private ownership the business was accompanied by the emergence of the capitalist economic system. Capitalism is an economic system which the means of production dealt largely in private hands and the main incentive for economic activity is the accumulation of profits. In practice capitalist systems varying degrees to which the government regulates private ownership and economic activity. Business retained the right to regulate itself and operate essentially without fear of government interference. Two centuries later, capitalism has taken on a fairly different appearance. Private ownership and maximum innovation of profits still remain the most significant characteristic of capitalist economy systems however, in contrast to the air of laissez-faire, capitalism today features government regulations of economic relations. Without restrictions, business firms could mislead consumers, endanger workers’ safety, and even destroy the company’s investors, all in the pursuit of greater profits. That is why the governments of capitalist nations monitors prices, set safety and environmental standards for industries, to tax the rights of the consumer, and regulates collective bargaining between labor unions and management. Capitalism as an ideal type government in its pure form, takes over ownership of an entire industry. Contemporary capitalists also differ from laissez-faire in other important respects: capitalism tolerates monopolistic practices. A monopoly exists when a single business firm controls the market. Domination of an industry allows the firm to efficiently control a commodity by dictating pricing, quality standards, and availability carry it buyers have little choice but to yield to the firm’s decisions; there is no other place to purchase a product or service. Monopolistic practices violate the ideal free competition cherished by supporters of laissez-faire capitalism. Some capitalist nations such as the United States, outlaw monopolies through antitrust legislation such laws prevent any business from taking over so much of the competition and industry that controls the market. The US Federal government allows monopolies to exist only certain exceptional cases, such as the utility and transportation industries. Even then regulatory agencies scrutinize officially approved monopolies to protect the public. There are often protracted legal battles in this uneasy relationship between government and private monopolies in the capitalist countries (Schaefer, R.T.2009). In numerous industries a few companies largely dominate the field and keep new enterprises from coming into the market (Schaefer, R.T.2009). Conflict theorists point out that although pure monopolies are not basic elements of the economy of the United States, competition is much more restricted than one might expect in what is called a free enterprise system. Critics of the conflict perspective point to its overtly negative view of society. Functionalists have defended the status quo, attempting to avoid social change, and believe people cooperate to effect social order. Historically it was the conflict theorists that have changed the laws and the functionalists that opposed those changes in my opinion (Schaefer, R.T.2009).
Social theory was developed in the writings Karl Marx and Frederick Engels. They were disturbed by the exploitation of the working class that emerged during the industrial revolution. In their view capitalism force large numbers of people to exchange their labor a low wages. The owners of an industry profit from the labor of workers primarily because they pay workers less than the value of the goods produced (Schaefer, R.T.2009).
As an ideal type, a socialist economic system attempts to limit such economic exploitation. Under socialism the means of production and distribution in a society are collectively rather than privately owned. The basic objective of the economic system is to meet people’s needs rather than maximize profits. Socialist rejected laissez-faire philosophy that free competition benefits the general public. Instead they believe that the central government, acting as the representatives of the people, should make basic economic decisions. Therefore of government ownership of or major industries including steel production or to mobile manufacture and agriculture is a primary feature of socialism as an ideal type. In practice socialist economic systems vary to the extent to which they tolerate private ownership. For example in Great Britain, a nation with some aspect of both socialist and capitalist economy, passenger airlines is concentrated in the government’s own corporation British Airways. Yet private airlines are allowed to compete with it (Schaefer, R.T.2009). Marx believed that social states would eventually wither away and evolve into communist societies. As an ideal type, communism refers to an economic system under which all property is commonly owned and no social distinctions are made on the basis of people’s ability to produce. In recent decades the Soviet Union, but People’s Republic of China, Vietnam, Cuba and nationalists in Eastern Europe were popularly thought of as examples of communist economic systems. However this usage represents an incorrect application of the term with sensitive political connotations. (Schaefer, R.T.2009). Each and every one of the nations known as communists in the 20th century in point of fact fell short of the ideal type. By the end of 1990s, communist parties no longer had pervasive influence on the nations of Eastern Europe. As of 2007, however, China, Cuba, Laos and Vietnam remain social societies ruled by communist parties. Nevertheless capitalism had begun to make inroads, even in those countries. In China fully 25% of the country’s production originated in the private business sector (Schaefer, R.T.2009). Capitalism and socialism serve as ideal types of economic system. In reality the economy of industrial nations including the United States, the European Union, and Japan, includes some elements of both capitalism and socialism. Whatever the difference, whether a society more closely fits the ideal type of capitalism or socialism, all industrial countries rely chiefly on mechanization in the production of goods and services (Schaefer, R.T.2009. p. 347)
The Informal Economy
In the informal economy transfers of goods money taking place, are not reported to the government. Examples of informal economy include trading services with someone for a haircut for computer lesson; selling goods on the street; an engaging in illiterate transactions such as gambling or drug deals. Participants in this type of economy avoid taxes and government regulation (Schaefer, R.T.2009). In developing nations, the informal economy represents a significant and unmeasured part of the total economy activity. Yet this sector of the economy depends to a large extent on the labor of women, work in the informal economy is undervalued or even unrecognized the world over. Functionalists contend that bureaucratic regulations sometimes contribute to the rise of an informal economy. In developing world government walked and sets of burdensome business regulations that overwork bureaucrats must administer. When request for licenses and permits pilot, delaying business projects, that it if it onto pit and was fined the need to go underground to get anything done. Despite its account efficiency, this type of informal economy is dysfunctional for country’s overall political and economic well being (Schaefer, R.T.2009).
Colonialism occurs when a foreign power maintains political, social, economic and cultural dominance over people for an extended period of time. In simpler terms it is ruled by outsiders. By the 1980s, colonialism has largely disappeared. Most of the nations that were Colonies before World War 1 had achieved political independence, establishing their own governments. For numerous countries the transition to a legitimate self rule was incomplete. Colonial dominance had established patterns for economic exploitation continuing even after nationhood was accomplished, partially because Colonies were unable to develop their own industry and technology. Consequently their dependency on more industrialized nations, including the former colonial rulers, for managerial and technical expertise continues. Capital Investment and manufactured goods kept former Colonies in a subservient position. Such ongoing dependency and domination is referred to as Neocolonialism. The resulting effect of economic and political consequences of colonialism and Neocolonialism, are extremely obvious. Drawing on the conflict perspective sociologists the Emanuel Wallenstein, viewed global economy systems as being divided between nations that control wealth and nations from which resources are taken. Through his world system analyst Wallenstein’s team described the unequal economic and political relationships in which certain industrialized nations (United States, Japan and Germany, included) and global corporations, dominates the core of the system. Core nation’s corporations control and exploit non-core Nations’ economies (Schaefer, R.T.2009).
The world is becoming increasingly urbanized a trend that is gradually illuminating the large pools of low cost workers to reduce a label cost. The exhaustion of land and water resources through clear cutting and pollution is driving up the cost of production. Wallenstein’s world system analyst is a widely used version of the dependency theory. According to this theory even as developing countries make economic advancements they remain weak and subservient to the core nations and corporations in an increasingly intertwined globally economy (Schaefer, R.T.2009). In the view of the world system analyst and dependency theory, a growing share of human and natural resources of developing countries is being redistributed to the core industrialized nations. This redistribution happens because in part because developing countries owe huge sums of money to industrialized nations, as a result they must come up loans, and trade deficits. The global debt crisis has intensified the third world dependency begun under colonialism, Neocolonialism, and multinational investment. International Financial institutions are pressuring indebted countries to take severe measures to meet the interest payments. The consequence is that developing nations could be forced to devalue the currency, freeze workers’ wages, increased privatization of industry, and reduce government service in employment. Conflict theorists view continuing dependence of on foreign powers as an example of contemporary neo colonialism (Schaefer, R.T.2009).
Some observers see globalization and it’s affects as a natural result of advances in communications technology, such as, the Internet and satellite transmissions of the mass media. As Service Industries become a more important part of the international marketplace, many companies are concluding that low cost overseas operations more than offset the expense of transmitting information world. The total revenues in multinational businesses are on equal levels with a total value of goods and services exchanged in entire nations. (Schaefer, R.T.2009).
Functionalist believe that multinational corporations can actually help the developing nations of the world, by bringing jobs and industrial areas where subsistence agriculture once served as the only means of survival. Multinationals also promote rapid development through diffusion of inventions and innovations from the industrial nations. Viewed from the functionalist perspective, the combination of skill technology and management provided by the multinational and relatively cheap labor available in developing nations is ideal for global enterprise. They argue multinationals can take maximum advantage of technology, reducing costs and boosting profits through their international multinational that’s corporations will also make the nations of the world more independent. Their rationale is; these ties may curtail disputes from reaching the point of severe conflict. A country cannot afford to set up diplomatic relations then engage in warfare with a nation that is headquartered as its main business supplier or main outlets for its exports (Schaefer, R.T.2009).
Conflict theorists challenge this favorable evaluation of the impact of multinational corporations. They emphasize that the multinationals exploit local workers to maximize profits. The pool of cheap labor in developing world prompts multinationals’ to move factories out of core countries. An added bonus for the multinationals is that developing worlds discourage strong trade unions. In industrialized countries organized labor insists on decent wages and human working conditions (Schaefer, R.T.2009).
Research on women in national as well as international and global markets has led critical scholars to argue that capitalist industry has systematically exploited female labor— free labor in domestic contexts and low-wage labor in the commercial sector— in ways that distinguishes women’s experience (i.e. patricularism) from that of men of equivalent race, ethnic, and class backgrounds. For example, in the European context, while Rubery, Smith, and Fagan (1999) find women’s increased labor participation since the 1980s as a striking change in European labor markets, equally conspicuous is the continuing inequality experienced by women in market-based workplaces. These reflect deeply seated social and cultural norms (aka, patriarchy) that coexist with the ‘market ideal’ that ostensibly emphasizes instrumental and universalistic criteria instead of the particularism inherent to gender discrimination (Scott 1994; see also US parallels Treiman and Roos 1983; Milkman 1987; Ridgeway 1997). Similarly, research by critical scholars on global economic development has made a strong case that the exploitation of women’s labor has, in part, laid the basis for both the industrialization of the west (Engels 1902; Kessler-Harris and Levenson 1982; Matthaei 1982) and the more recent expansion of markets into parts of the developing world (Boserup 1970; Enloe 1990; Cheng and Hsuing 1992; Escobar 1995) (Korczynski, et-al, eds. 2006).
Opposing capital's globalization from above, cyber activists have been promoting globalization from below, developing networks of solidarity and propagating oppositional ideas and movements throughout the planet. Concurrently, the Right wing and reactionary forces have used the Internet to promote their political agendas as well. (Kellner, D.2002).
Social inequity describes a condition in which members of society have different amounts of wealth, pressed each, or power some degree of social equity characterizes every society. Income inequality is a basic characteristic of a class system in 2006 the median household income in the United States was $48,201 in other words half of all households headed higher incomes in that year. But this fact is not fully conveyed the income disparities in a society there is a broad range around the median income. Furthermore a considerable number of people fall to the extremes. In 2003 about 181 1000 tax returns reported income in excess of one million dollars at the same time over 23,000,000 household reported incomes less than 9000. About 1 to 2% of the people of the United States are the very wealthy. In contrast lower class consists of approximately 20- 25% of the population, it disproportionately consists of blacks, Hispanics, single mothers with dependent children, and people cannot find regular work one must subsist with low paying work. This class lacks both wealth and income and is too fragile politically to exercise significant power (Schaefer, R.T.2009). Sandwiched between the upper and lower classes in this model of the upper middle class and lower middle class is the working class. The upper middle class numbering about 10 to 15% of the population is composed of professional such as doctors, lawyers and architects. They participate extensively in politics and taking leadership roles in voluntary associations. The law may look less which accounts for approximately 30 to 35% of the population, includes the less affluent professionals such as the elementary school teachers and nurses owners of small businesses, and sizable number of clerical workers. While not all members of group have degrees from college they share a goal of sending the children there. This class is currently under a great deal of economic pressure. They are what are known as the shrinking middle class (Schaefer, R.T.2009).
Sociologists view the various perspectives of functionalism, conflict Theory, and Interactionism of all having an impact on the economy, in a unique way, because the economy is an important element of society, sociologists are interested in how those segments of the political populace had an influence and effect on the economy, its concepts of society’s social forces, and human behavior.
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