The law of political economy is a contentious ideological field characterised by antagonistic relations between scholarly positions which tend to be either affirmative or critical of capitalism. Going beyond this schism, two particular features appear as central to the law of political economy: the first one is the way it epistemologically seeks to handle the distinction between holism and differentiation, i.e., the extent to which it sees society as a singular whole which is larger than its parts, or, rather, as a mere collection of parts. Different types of legal and political economy scholarship have given different types of answers to this question. The second feature of the law of political economy is the way in which it conceives of the relation between hierarchical and spontaneous dimensions of society, i.e., between firms and the market, or between public institutions and public opinion. The two distinctions can, however, be overcome through a third-way, emphasising the strategic role of law in mediating between holism and differentiation and hierarchy and spontaneity. This is demonstrated through a historical re-construction of the evolution of corporatist, neo-corporatist, and governance-based institutional set-ups of political economy.

The global trade and investment law regime is disintegrating. It is becoming increasingly impossible to speak of a singular regime spanning the globe; instead, there are now several regional-based regimes with quite distinct characteristics.

A rethinking of trade and investment law (TIL) needs to take this insight as its point of departure and is possible only by understanding the structural composition and direction world society is taking and the deep-seated cultural and social (including political) structures and contexts within which it operates. Both orthodox and heterodox TIL relies on assumptions concerning the state of the world and the driving forces behind it, but those assumptions need to be subjected to scrutiny and substantial rethinking.

For heterodox TIL, critical globalization studies (CGS) has emerged as a central counternarrative to the neoliberal globalization discourse of the preceding decades. CGS rightly points out the deficiencies of the neoliberal paradigm and the problems created through increased inequality, the straightjacketing of policy choices and the volatility created in the world economy due to the boom-and-bust culture installed through liberalization of capital markets and the like. But by digging a bit beneath the surface of policy discourses and practical politics, a number of structural transformations can be observed that might also need to be considered when rethinking TIL.

The core paradox we are dealing with is that increased globalization has implied an increase rather than a decrease in global diversity. A future-oriented TIL therefore should be thought of in the plural, not in the singular, as it is likely to fragment into a number of regional TIL regimes based on very different philosophies and institutional setups.

The End of the Western-Centric World

Claiming that the world is at a tipping point easily becomes tiresome— all ages and eras believe they live through a “special moment.” However, we may indeed be experiencing a tipping point. The breakdown of the Eurocentric world is now being followed by the breakdown of the Western-centric world. The Eurocentric world started to collapse in the late nineteenth century with the rise of the United States, and later Japan and the Soviet Union, and became manifested in the mid-twentieth-century decolonization processes. Today the concept of the West is disintegrating, with Europe and the United States moving steadily apart in political, economic, social and cultural terms and becoming strangers.