The Role of Law in Markets: From Industrial Revolution to Economic Dissolution

Ioannis Glinavos

University of Reading

July 1, 2011

SLS Conference 2011 Society of Legal Scholars

This paper follows the evolution of economic and legal theory on how to balance the market-state relationship from the era of the industrial revolution, till the resurgence of liberalism in the latter part of the twentieth century. The aim is to show how law and regulation have been used as buffers, in accordance perhaps with neoclassical assumptions, against the potential of the market to self-destruct. The paper traces the role of law in economic regulation from the early industrial era to the current economic crisis marking significant conceptual changes that took part in the early 20th century, the radical shift in perceptions of law brought about by the Great Depression and the resurgence of theories of laissez-faire since the 1970s. The paper also explores the consequences of various incarnations of the balance between state control and market freedom on the wider political economy. It considers how the tendency towards de-politicisation exemplified by deregulation from the early 1980s till the financial crisis of 2008 is responsible for a degrading of the role of the state and politics leading to a sub-optimal balance of market vis-a-vis social interests.

Keywords: law, economics, neoclassical economics, financial crisis, political economy, laissez-faire, Great Depression

JEL Classification: A12, P26, P48

working papers series

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Date posted: July 1, 2011  

Suggested Citation

Glinavos, Ioannis, The Role of Law in Markets: From Industrial Revolution to Economic Dissolution (July 1, 2011). SLS Conference 2011 Society of Legal Scholars. Available at SSRN: http://ssrn.com/abstract=1876389

Contact Information

Ioannis Glinavos (Contact Author)
University of Reading ( email )
Reading, RG6 6AH
United Kingdom
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