Book Notes - Nicolas Hatzfeld

Regulation Theory : the State of Knowledge

Paris: Editions La Decouverte, 1995. 568 pages.

Twenty years have passed since regulation theory first appeared. The aim of this book, as the title suggests, is to bring the reader up to date on its development through a series of commentaries. On the one hand, while neo-liberal economics, which retains its postulates on the internal rationality of the economic domain, the equilibrium between forces, and the role of the market as the sole intermediary between economic agents, is regaining influence even though it fails, as much as ever, to recognize the significant contemporary problems. And yet some of these are compelling issues: the rupture of the virtuous circle of employment and the persistence of unemployment; the blockage of productivity despite technological progress because of institutional rigidities; the contradiction in Europe between the expansion of the economic space and the fragility of Community rules; and lastly, the decomposition of socialist economies does not imply the spontaneous construction of the market, which confirms that the latter is the outcome of a set of complex rules and coordinations and not of the interplay of natural forces.

Regulation theory is in need of a revamped presentation. Its "pillars" are still important: the link between economics and neighbouring disciplines (history, sociology, political science); the progressive process of generalization; the historicity of economic processes; the ambition of constructing a set of hypotheses the explanatory value of which is as broad as possible. Nevertheless, over the past twenty years studies have multiplied, with diverse methods and challenges, as the contributions of 45 researchers from Europe, the United States, Latin America and Japan in this book bear witness, and certain earlier texts have become outmoded.

The overall construction of the book offers an overall progressive trajectory via a collection of about fifty comparatively short but distinct chapters:

- The original influences and the basic ideas of the theory (chapters 1-6).

- Development of the theory, in two groups of chapters: the study of the five institutional forms which make up the foundations of the regimes of accumulation and modes of regulation i.e. money, employment relationships, competition, insertion of the national economy into the international economy, the state (chapters 7-19); and application of these ideas to macro-economic domains (chapters 20-27).

- Analysis of contemporary transformations: different levels of regulation, territories, sectors, ecology, Europe (chapters 29-36); national trajectories according to the type of country: OECD countries, former Eastern Block countries, developing countries (chapters 38-48).

- Ending with some avenues for the future development of the theory (chapters 49-53).