Regulatory Capitalism

Regulatory Capitalism

How it Works, Ideas for Making it Work Better

John Braithwaite

Contemporary societies have more vibrant markets than past ones. Yet they are more heavily populated by private and public regulators. This book explores the features of such a regulatory capitalism, its tendencies to be cyclically crisis-ridden, ritualistic and governed through networks. New ways of thinking about resultant policy challenges are developed.

Chapter 1: Neoliberalism or Regulatory Capitalism?

John Braithwaite

Subjects: economics and finance, public sector economics, politics and public policy, public policy, regulation and governance, social policy and sociology, economics of social policy

Extract

1 REGULATION AND NETWORKED GOVERNANCE States can be thought of as providing, distributing and regulating.2 They bake cakes, slice them, and proffer pieces as inducements to steer events. Regulation is conceived as that large subset of governance that is about steering the flow of events, as opposed to providing and distributing.3 Of course, when regulators regulate, they often steer the providing and distributing that regulated actors supply. We build on Jacint Jordana and David Levi-Faur’s (2003; 2004) systematic evidence that, since 1980, states have become rather more preoccupied with the regulation part of governance and less with providing.4 Yet non-state regulation has grown even more rapidly, so it is not best to conceive of the era in which we live as one of the regulatory state, but of regulatory capitalism (Levi-Faur 2005a). This involves expansion of the scope, arenas, instruments and depth of regulation (Levi-Faur et al. 2005). Levi-Faur (2005a) identifies transitions from laissez-faire capitalism (1800s–1930s) to welfare capitalism (1930s–1970s) to regulatory capitalism (1970s on). This chapter seeks to refine somewhat the transitions from feudalism to more welfarist and regulatory capitalisms. Governance is a wider set of control activities than government. Students of the state noticed that government has shifted from ‘government of a unitary state to governance in and by networks’ (Bevir and Rhodes 2003: 1; Rhodes 1997). But because the informal authority of networks in civil society not only supplements but also supplants the formal authority of government, Bevir, Rhodes and others in...

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