Regulation Theory
definition
regulation theory is a Marxist approach to political economy. It examines how particular forms of capitalism achieve a temporary stability. Karl Marx famously argued that capitalism was inherently unstable : first, because it led to over-accumulation of capital and so periodic crises, and second, because it generated an unstable set of social relations that resulted in class struggle. These instabilities would result, Marx added, in a working-class revolution to establish a communist society. Regulation theory focuses on the ways in which material, institutional, policy-driven, and discursive supports allow capitalism to regulate its instabilities in order to ward off revolution.
The concern with the temporary stability of capitalism leads regulation theorists to explore its varieties across time and space. Several regulation theorists identified a Fordist variety of capitalism, associated with Keynesian economic policies and a welfare state, which had achieved a temporary stability for much of the twentieth century. Yet, from the late 1970s, Fordism and the Keynesian welfare state came under attack from the neoliberals of the New Right. The rise of neoliberalism coincided with the introduction of the New Public Management, and more broadly, with the rise of the new governance Regulation theorists were among the most prominent Marxists to explore these changes in society and the state Typically they explained the rise of the new governance as part of a shift from a Fordist to a post-Fordist form of capitalism