ABSTRACT
Traditionally, all of the mainstream schools of economics – classical, neo-classical, Marxist and Keynesian – have had difficulty coping with the role of the state in the capitalist economy, and have tended to treat the state in a subsidiary and reductive way (Schott, 1984; Caporaso and Levine, 1992). 1 States may help clear the way for accumulation, and may help alleviate some of the shortcomings and undesirable consequences of the accumulation process, but they do not decisively influence the forms of economic organization and co-ordination of economic activities. Recently, a number of new ‘state-centred’ approaches to political economy have appeared (see Caporaso and Levine, 1992), which at last recognize that states may interfere in the economy not simply to readjust it or to compensate for its undesirable externalities or to manage its social tensions, but with the explicit political-ideological intention of shaping its very functioning and organization. 2 However, these still tend to see the state and the market as regulatory institutions that are necessarily antithetical to one another, so that when one increases the other correspondingly declines. As a result, our understanding of the forms of capitalism that are likely to be promoted by state intervention remains limited.
