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Taking the State Seriously: Policy, Polity, and the Politics of Ideas and Discourse in Political Economy

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Abstract:

The financial markets are the crucial test for competing theories about the nature and direction of reform in contemporary advanced capitalist political economies. While some political economists see the financial markets as the drivers of convergence to one model of capitalism, others subordinate the financial markets to firms as drivers of divergence to two varieties of capitalism, and yet others deconstruct the financial markets into coalitions of capital, management, and labor driving divergence. All three downplay the role of the state. This paper argues that by not taking the state seriously, none of these approaches is able to explain the real differences in degree and kind of countries’ reform trajectories. Taking the state seriously means considering it in all its complexity, not only as political economic institutional context but also as policy, polity, and politics. It also requires adding one more methodological approach to political economists’ usual historical and rational choice institutionalist approaches: discursive institutionalism, which lends insight into the political dynamics of political economic change through ideas and discourse. The paper illustrates with the case of regulatory reform in the financial sector, providing in-depth analysis of recent reforms in the US and the UK. It demonstrates that even in similarly liberal market economies, policy reform trajectories differ as a result of differences in the political as well as political economic ideas and discourses communicated in different political institutional contexts.

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state (181), financi (143), polit (135), market (125), discours (114), regulatori (97), institut (96), reform (89), regul (88), polici (75), liber (62), actor (61), capit (54), idea (51), new (50), govern (48), bank (48), us (48), system (46), differ (44), public (44),

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state, ideas, discourse, financial markets, varieties of capitalism, policy, politics, political economy
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Schmidt, Vivien. and Westrup, Jonathan. "Taking the State Seriously: Policy, Polity, and the Politics of Ideas and Discourse in Political Economy" Paper presented at the annual meeting of the APSA 2008 Annual Meeting, Hynes Convention Center, Boston, Massachusetts, Aug 28, 2008 <Not Available>. 2010-03-12 <http://www.allacademic.com/meta/p278788_index.html>

APA Citation:

Schmidt, V. A. and Westrup, J. , 2008-08-28 "Taking the State Seriously: Policy, Polity, and the Politics of Ideas and Discourse in Political Economy" Paper presented at the annual meeting of the APSA 2008 Annual Meeting, Hynes Convention Center, Boston, Massachusetts Online <APPLICATION/PDF>. 2010-03-12 from http://www.allacademic.com/meta/p278788_index.html

Publication Type: Conference Paper/Unpublished Manuscript
Abstract: The financial markets are the crucial test for competing theories about the nature and direction of reform in contemporary advanced capitalist political economies. While some political economists see the financial markets as the drivers of convergence to one model of capitalism, others subordinate the financial markets to firms as drivers of divergence to two varieties of capitalism, and yet others deconstruct the financial markets into coalitions of capital, management, and labor driving divergence. All three downplay the role of the state. This paper argues that by not taking the state seriously, none of these approaches is able to explain the real differences in degree and kind of countries’ reform trajectories. Taking the state seriously means considering it in all its complexity, not only as political economic institutional context but also as policy, polity, and politics. It also requires adding one more methodological approach to political economists’ usual historical and rational choice institutionalist approaches: discursive institutionalism, which lends insight into the political dynamics of political economic change through ideas and discourse. The paper illustrates with the case of regulatory reform in the financial sector, providing in-depth analysis of recent reforms in the US and the UK. It demonstrates that even in similarly liberal market economies, policy reform trajectories differ as a result of differences in the political as well as political economic ideas and discourses communicated in different political institutional contexts.

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Document Type: application/pdf
Page count: 27
Word count: 13265
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TAKING THE STATE SERIOUSLY: POLICY POLITY AND THE POLITICS OF IDEAS AND DISCOURSE IN POLITICAL ECONOMY Vivien A. Schmidt Jean Monnet Professor of European Integration Department of International Relations Boston University 152 Bay State Road Boston MA 02215 Tel: 1 617 3580192 Fax: 1 617 3539290 Email: vschmidt@bu.edu Jonathan Westrup Senior Specialist Irish Management Institute Sandyford Road Dublin 18 Tel: 353 1 2078426 jonathan.westrup@imi.ie Paper prepared for presentation to the National Meetings of the American Political Science Association Boston
Governing Global Banking: The Basel Committee and the Politics of Financial Globalisation. Ashgate: Aldershot. .Wood Stewart (2001) ‘Business Government and Patterns of Labor Market Policy in Britain and the Federal Republic of Germany’ in Peter A. Hall and David Soskice (eds) Varieties of Capitalism: The Institutional Foundations of Comparative Advantage. Oxford: Oxford University Press. 25 Zaller John R 1992 The Nature and Origins of Mass Opinion. Cambridge: Cambridge University Press . Zürn Michael and Stephan Leibfried (2005) “A New


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