Globalisation and public policy under New Labour

The concept of the Competition State differs from the Post-Fordist State proposed by regulation theory, which asserts that the contemporary restructuring of the state is aimed at maintaining its general function of stabilising the national polity and promoting the domestic economy in the public interest. In contrast, the Competition State focuses on the transformation of the state from within with regard to the reform of political institutions, functions and processes, in the face of processes of globalisation. It is argued that the state does not merely adapt to exogenous structural constraints; domestic political actors take a proactive lead in the process through both policy entrepreneurship and the rearticulation of domestic political and social coalitions, on both the right and the left, as alternatives are incrementally eroded. State intervention itself is aimed at not only adjusting to, but also sustaining, promoting, and expanding an open global economy in order to capture its perceived benefits. Such strategies, while reinforcing the roles and positions of such actors, can also undermine the generic function of the state seen in terms of traditional conceptions of social justice and the public interest and create the space for social conflict. It is further argued that the New Labour government in the UK has adopted a policy agenda which in its most crucial aspects reflects the continuing transformation of the British State into a Competition State in an attempt to adapt state action to cope more effectively with what they define as global ‘realities’.