Regulatory State with Dirigiste Characteristics: Variegated Pathways of Regulatory Governance

The strength of the introductory chapter by Morgan and Dubash is in their clarion call to understand the specificities of the regulatory state in the global south. They ask us to give serious consideration to the notion that the regulatory state in the global south confronts issues, problems, and pathways of development which are different from those apparent in the highly Euro-centric literature on the regulatory state where it is portrayed almost as a triumph of a European mode of governance. From this point of view, this chapter and the various case studies represent a much needed corrective to this geographical bias. In fact, it represents more than the addition of the experience of the global south; it presents a much more complex and variegated view of the regulatory states than that suggested by the mainstream analyses. In this paper, I want to build on this insight, but also suggest that case studies in the volume implicitly point to an altogether different methodological understanding the regulatory state through the analysis of the process of regulatory state-building rather than through identifying the exceptional attributes of regulatory governance in the global south. Such a process oriented perspective to regulatory state-building throws into relief the problematic identification of regulatory types forcing us to more rigorously consider the primary set of processes that produce varieties of regulatory states in the global north and south. In this respect, the introductory chapter raised a nagging concern that the references to the global south should not fall into a kind of the modernisation problematic where the emerging regulatory state is seen as a response to a particular set of developmental constraints and patterns of regulatory governance, which are then benchmarked against the modal regulatory state in the global north. A thrust of this brief paper is that we need to get away from such ideal types, and focus more on the process of state and market formation by looking at regulatory governance and politics as an on-going process of state-building within systems of transnational markets and rule making. Of course, in making this criticism, I do not exempt my own work (see for example, Jayasuriya 2005) which tended to obscure the emerging varieties of regulatory state. Taking this tack of analysing the production of variation allows us to sail much more confidently into the murky seas of the relationship between neoliberalism or market-making and the regulatory state. Market-making and state-building projects have gone hand in hand, and for this reason their distinctive patterns in the global north as well as the global south require further analysis. From such a perspective, variations and experimentations of regulatory state structures and institutions are central to the process of market reform – or neoliberalism – in both the global north and south. The introductory chapter and the various case studies by and large stay clear of notions of neoliberalism, or if you prefer, programs of market. Yet, at the root of the development of regulatory forms is the attempt to constitute or enhance programs of marketization. In fact, this is a thread that runs through the various case studies ranging from water services in Columbiato telecommunication regulation in India. And in these chapters we see clearly that market building is at the core of the project of regulatory state-building. These two dimensions are irreparably bound. This is well exemplified – if not highlighted – in many of the case studies where the relationship between the politics of neoliberalism and regulatory state-building remains obscured. Hence what is overlooked in the various case studies is the fact that the processes of market reform – or neoliberalism – do not simply emerge from ‘nowhere’, but are contingent products of specific localised political and economic contexts. If market-making is about state-building, it follows that the nature of this relationship is shaped by the previous patterns of institution building and its privileged elites. In the section below we explore these processes of regulatory state-building and its variegated character by exploring three key areas: first, the embedding of patterns of market reform within previously dominant statist economic regimes that is the path dependence of the regulation; second, the extent to which this path dependence is modified by the transnationalisation of the state through mechanisms of multilevel governance; and finally how this multilevel governance results in a process of juridification of the regulatory state that shapes a distinctive form of politics.