The Global Diffusion of Regulatory Capitalism

This paper analyses the rise of the new order of regulatory capitalism. It starts with an analytical and historical analysis of the relations between capitalism and regulation, and suggests that change in the governance of capitalist economy is best captured by reference to five dimensions: (a) a new division of labor between state and society (e.g., privatization); (b) an increase in delegation (redefining the boundaries between the experts and the politicians); (c) proliferation of new technologies of regulation; (d) formalization of inter- and intra-institutional relations and the proliferation of mechanisms of self-regulation in the shadow of the state; and (e) the growth in the influence of experts in general and of international networks of experts in particular. Regulation, though not necessarily directly by the state, seems to be the wave of the future and the current wave of regulatory reforms opens a new chapter in the relations between the state and the economy. It is therefore suggested that is the notion of regulatory capitalism (rather than of the regulatory state or the regulatory society) best captures the extent to which governance nowadays rests on rule making and rule enforcement in both the domestic and the international arenas