Research focus
Our emphasis on the market as a key arena for development does not suppose a belief that markets are perfect. Quite the contrary. Markets are good at producing growth and innovation but they have a very poor track record of redistribution, particularly in developing countries, where state institutions are weaker. That is why an active and informed engagement of civil society with the market is essential to translate increased economic output into improved living conditions for the poor.
Moreover, an active civil society may play a crucial role in developing alternatives when the State is unable or unwilling to provide an answer to market failures. What we call social economy refers to these types of civil society actions that go beyond simply providing adjustments to the market by actually creating new, alternative markets.
The engagement of civil society with the market is not new. As Karl Polanyi noted in The Great Transformation, society always reacts to keep the potentially destructive powers of markets in check. What has changed, however, is the guise under which organized civil society operates. Globally fragmented and dispersed supply chains pose new challenges to organized labour, as the power wielded by traditional unions declines.
Moreover, the landscape of NGOs is changing. New types of NGOs have emerged, notably business foundations, both large and small and those created by private initiatives.
The new types of interactions between society, State and markets put civic organizations at a critical juncture. Civic initiatives struggle to gain recognition and advance their ideas, and their survival often hinges on the degree to which they can engage with governmental and private institutions. Yet this embedding that guarantees their persistence and allows them to mainstream their efforts also entails a process of hybridization that can turn them into something quite different form what they were originally intended to be. There is, then a tension between achieving their objectives and changing their very reason for being.
The changing role of the State does not mean, as some would have it, that it has disappeared. States continue to play an active role in shaping the structure and functioning of both civil society and markets, and at the same time its very role is shaped by societal and market pressures. Our focus on the market as a driver of development does not remove the State as an object of analysis, but it forces us to see its role in quite a different light.
