BOOK REVIEW Mark Granovetter: Society and Economy: Framework and Principles Massachusetts: Harvard University Press, 2017 Mufsin Puthan Purayil Ó Indian Institute of Management Calcutta 2018 In neoclassical economics actors are assumed to be perfectly rational—that is, while engaging in eco- nomic activities, human beings take account of available information, probabilities of events, calcu- late potential costs and benefits of making choices, and always pursue their subjectively defined ends opti- mally. However, this homo economics assumption fails in reality as individuals as economic actors are influenced not only by an urge to maximize one’s utility but also by a variety of factors which are noneconomic in nature. A major figure to theorize this relationship in contemporary scholarship is Mark Granovetter. In this book, he continues with his project of delineating the disparate ways in which society and economy are intertwined. His simple yet powerful idea that ‘all economic activities are socially embedded’ forms the basis of this long-overdue and much anticipated work. Although Granovetter recognizes the importance of the ‘institutional’ turn (how institutions and culture shape economic behaviour) in economics, he consid- ers its contribution as still operating within the neoclassical assumption of ‘atomized individuals’ (p. 13). Institutional economics, albeit recognizes the potential of noneconomic factors to determine economic action, believes that once actors’ social positions and behavioural patterns are recognized, their actions can be predicted without further attention to their social location or networks of interaction. If the former is an undersocialized (purely agential) view, the latter, Granovetter argues, is an oversocial- ized (purely structural) view. For, in reality, culture does not follow a simplistic path. It is not a once-for- all relationship, rather it is an ongoing process, continuously constructed and reconstructed during interaction between different actors. Thus, there is a strong interplay between institutions and human purposive action. Calling for a midway, the author urges scholars to move freely between disciplines and utilize concepts from whatever available sources to understand the economy in its full essence. In chapters 2, 3, and 4, Granovetter outlines three aspects which are of crucial importance to economic activities: norms, trust, and power. By utilizing the empirical work done by scholars in different fields, he sets out to show what role these important social forces play in economic action and outcomes. Economics’ understanding of norms suggests a cost–benefit logic. The oft-repeated rational choice account argues that people conform to norms only when the benefit of doing so outweighs the cost. But in reality, norms do not work that way. Norms are socially shared and accepted as a patterned way of doing things. They are internalized—people follow norms more or less automatically (neither because of any positive M. Puthan Purayil (&) Public Policy and Management Group, Indian Institute of Management Calcutta, Kolkata, India e-mail: mufsinpp16@iimcal.ac.in 123 Decision https://doi.org/10.1007/s40622-018-0174-z