The Régulation School is a group of writers on political economy and economics whose origins can be traced to France in the early 1970s where economic instability and stagflation were rampant in the French economy. The term ‘régulation’ was coined by Frenchman Destanne de Bernis who aimed to use the approach as a system theory to bring Marxist economic analysis up to date.[1] They are influenced by structural Marxism, the Annales School, and institutionalism among others and sought to present the emergence of new economic (and hence, social) forms in terms of tensions existing within old arrangements. Since they are interested in how historically specific system of capital accumulation is 'regularized' (i.e. stabilized), their approach is called "regulation approach" or "regulation theory". Though this approach originated in Michel Aglietta's monograph, A Theory of Capitalist Regulation: The US Experience (Verso, 1976) and popularized by other Parisiens such as Robert Boyer [1], the school membership goes well beyond the so-called Parisien School: Grenoble School, German School, Amsterdam School, British radical geographers, Social Structure of Accumulation School (US), and neo-Gramscian school, etc.
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Robert Boyer describes the wide encompassing theory as “The study of the transformation of social relations, which creates new forms- both economic and non-economic- organized in structures and reproducing a determinate structure, the mode of reproduction” [2] This theory or approach looks at the capitalist economies as a function of social and institutional systems and not just as government's role in the regulation of the economy although that is a big part of the approach.
Regulation theory discusses historical change of the political economy through two central concepts: Regimes of Accumulation (or Accumulation Regime)(AR) and Modes of Regulation (MR). ARs are particular forms in which capital organises and expands through production, circulation, consumption, and distribution for a period of time, with some degree of stability. Regimes of Accumulation analyze the way production, circulation, consumption, and distribution organizes and expands capital in a way that stabilizes the economy over a period of time. Alain Lipietz in Towards a New Economic Order describes the Regimes of Accumulation of Fordism as mass producing, proportionate share-out of value added, and a consequent stability in firm’s profitability; with the plant used at full capacity and full employment are all elements of this approach (p. 6).
MRs are institutional sets of law, norms, forms of state, policy paradigms and other practices which provide the context for the AR's operation. Typically, it is said that it comprises money form, competition form, wage form, state form, and international regime, but can encompass many more elements than these. Generally speaking, MRs support ARs by providing a conducive and supportive environment, in which the AR's are given guidelines to which they should follow. In case that there is a tension between the two, then there may occur a crisis. Thus this approach parallels Marx's characterisation of historical change as driven by 'contradictions' between the forces and the relations of production (see Historical Materialism).
Bob Jessop summarises the difficulties of the term in Governing Capitalist Economies, where he states: "The RA seeks to integrate analysis of political economy with analysis of civil society and or State to show how they interact to normalize the capital relation and govern the conflictual and crisis-mediated course of capital accumulation. In this sense, 'régulation' might have been better- and less mechanically-translated as regularization or normalization" (p 4). Therefore the term régulation does not necessarily translate well as regulation. Regulation, as in the sense of government action, does have a part in Régulation theory.
Robert Boyer identified two main distinct modes of regulation throughout the 19th and 20th centuries.
Regulationist economists make a distinction between cyclical crisis and structural crisis. They study only structural crisis, which are the crisis of a mode of regulation. From this distinction, the regulationists have made a typology of the crises which gives an account of various disarrangements in the institutional configuration - according to its initial objective which was to understand the rupture of the fordist made of regulation: