Introduction

There is broad agreement among social analysts that capitalism changed in significant ways starting around 1980. However, there is disagreement about how to characterize those changes, what the key features of capitalism have been in recent decades, and what name to apply to the contemporary form of capitalism. In our view, the concept of “global neoliberalism” best captures the contemporary social reality.

In Europe liberalism has long referred to a stance that advocates limited government intervention in the economy. States were generally less active in seeking to manage capitalist economies before the Great Depression of the 1930s than they were after World War II. This does not mean that capitalist states followed a consistently laissez-faire approach in the past. Chang (2002) has shown that states actively promoted industrialization in every major developed capitalist country during its period of early development. In late developers such as Germany and Japan, the state was even more active than in the earliest cases. However, once industrialization was completed, in most developed capitalist countries the state played a relatively limited role in the economy prior to the Great Depression.

Following the Great Depression and World War II, new national social structures of accumulation (SSAs) emerged in the capitalist world in which the state actively regulated the macroeconomy as well as key economic sectors, nationalized some industries in many countries, and provided a set of social programs that is often summed up as the “welfare state.