Disorder and Public Concern Around Globalization

6The State in View of the Globalization Challenge

The globalization we have experienced in the years after the Second World War is subject to the primacy of national regulations supported by institutional variations specific to different nations, but contributing to the objective of national growth and solidarity¹. The new globalization is reversing the order of priorities. National objectives are subject to it². It is, more or less explicitly, the fulfillment of an ideal, that of general market equilibrium, which is essentially a-institutional, rendering the national framework or even the existence of States obsolete. More exactly, institutions promoted are reduced to strict rules assumed to guarantee free competition. National objectives are reduced to numerical indicators that do not measure performance, but the degree of compliance with these rules. The existence of rigidities or frictions described as market imperfections is considered harmful in terms of efficiency and well-being. The required structural policy consists of reducing these rigidities and frictions, such as to restore a supposedly optimal market environment with the idea that once this reduction is made, corporate and household behaviors will instantly change, some to invest more, and others to consume more³.

Regarding institutions, they give rise to a hierarchical ranking, with perfect competition consisting only of rules that place it at the top of this hierarchy. The purpose for the demand of structural ...