In 1977, James C. Scott wrote a two-part essay on the “little traditions” followed by peasants who adopted formal religious identities but whose on-the-ground beliefs and practices often diverged from the strict orthodoxies of the “great traditions” promoted by central religious authorities (“Protest and Profanation,” Theory & Society, 4(1), 1977: 1–38). Scott observed that doctrines, be they religious or otherwise, “are elaborated at the urban centers of civilization by intellectual ‘high priests’ and then propagated to the countryside. In the course of propagation they undergo a . . . transformation; some themes are lost, new ones are added, symbols acquire new meanings and are put to new purposes” (“Protest,” p. 2).
Starting a review of Ruling Ideas with snatches from Scott’s work may seem odd; after all, Cornel Ban’s book is about neoliberal ideas and policy regimes, not about the spread of religious traditions. But Scott and Ban share a common interest: They want to better understand the conditions shaping how local “translators” interpret, refashion, and operationalize the “scripts” that missionaries from the powerful core want to spread. And in this deeply researched and richly detailed book, Ban breathes some new life into a long-standing research tradition centered on the question of how “foreign” models are transplanted into local settings.
Ban’s analytical framework, laid out in the first chapter, seeks to explain why and how “edits” (p. 3) applied by local interlocutors to global neoliberal economic policy scripts yielded different types of policy regimes in two countries, Spain and Romania. To do so, Ban reconceptualizes an essentially contested term—“neoliberalism”—in order to make the case that local “edits” need not be treated as “anti-neoliberal.” Rather, neoliberalism is conceptualized here as an internally heterogeneous, “temporally contingent,” flexibly applied, and open system of economic thought, rather than the “seamless and time-invariant construct” that, Ban argues, characterizes how many other political economists have treated the concept (p. 11). What this alternative conceptualization does is expand the range of economic life that “neoliberal” thinking addresses. In this more capacious version, it is not just that neoliberal theorizing and policy advice seeks to make macroeconomic management and foreign-oriented economic policies more market conforming; neoliberalism is extended to touch on a range of other things, such as “supply-side” policies affecting firms’ strategies and income-redistribution efforts. The boundary of neoliberalism is found where policy agendas breach any of three “fundamental goals” of neoliberalism: openness to international trade and financial flows; relying on perceptions of “financial market credibility” as a bellwether for loosening or tightening public finances; and basing growth strategies on the concept of “competitiveness” (p 10). Provided that these barriers are not overrun, “local translators” can splice in elements that do not fit well with the purer “source” neoliberal doctrine to create hybrid forms that remain in the neoliberal mode.
Rather than describe a wide range of hybrid forms, Ban lands on two different types: the “embedded” and “disembedded” varieties of neoliberal policy regimes. The edits to the neoliberal script under the embedded type—exemplified by the Spanish case—are meant to “maximize the policy space for downward redistribution of income and opportunities to compensate society against market dislocation,” using things like taxation, health, and active labor market policies (p. 14). Under disembedded neoliberalism, by contrast, upward redistribution of income produced by market forces is accelerated, not counteracted, by the prevailing policy regime. Romania is the exemplar of the disembedded type.
To explain why these countries diverged in the type of neoliberal policy regime they developed, Ban points to four factors. First is the country’s “institutional past,” conceptualized as features (including a country’s regime type and “geopolitical position,” p. 20) that either facilitated or inhibited the circulation of neoclassical economic ideas within ecologies linked to policymaking. Second is the degree to which local translators depend on the symbolic and material support of the global hubs for neoliberal economic ideas. Third, the “cohesiveness” of the policymaking teams at the helm of the economy influences the character of the policy regime. Finally, Ban points to the vulnerability of countries to coercive pressure from outside actors (such as the International Monetary Fund) that hew to purer forms of neoliberalism as a factor that can lead to the “pruning” of “local hybrids” (p. 28).
To test these arguments, Ban compares the evolution of economic policy regimes in Spain and Romania, focusing most of the narrative on the post-1980s period (though due attention is given in the book to the much earlier developments in each country that shaped the policy regimes that came later). The granular reconstruction of how policymaking evolved in these two cases is impressive—although at times, the barrage of names and affiliations is so thick that it becomes difficult to keep track of who is who and what role they are playing in the story. Since I am not an expert on either of these cases, I had no strong reason to seriously doubt the author’s interpretation of the key forces that drove each country’s adaptation of “core” neoliberal economic beliefs into workable policy agendas.
I remain less than fully convinced, however, by Ban’s answer to one question: How much were the policies that “disembedded” markets in Romania a product of structural forces (namely, the pressure to attract outside investment and the leverage of the international financial institutions over the country) that had dramatically narrowed the country’s policy space? Ban argues that this interpretation is insufficient because the Romanian neoliberal regime went well beyond what outsiders demanded; the main illustration of this claim is the adoption of a flat tax on personal income and corporate profits in January 2005. But is it so surprising that a fringe idea might hold appeal for officials in one of the poorer countries in the region that wants to attract foreign investment and retain its remaining pool of skilled workers? The author argues that “it takes a radical neoliberal view of state-society relations and of what states can do to attract investment in order to take such a bold step” (p. 90). Coming around to that view seems likelier when peers (all of which are competing for capital and workers as barriers to mobility fall) take the same bold step (and it is worth noting that flat-tax schemes were implemented in Estonia and the other Baltics, Russia, Serbia, Ukraine, Slovakia, and Georgia before Romania passed its own tax reform).
The primary issues I raise in this review are not about interpreting the evidence in the book’s case studies, however. The first issue I want to engage concerns the formulation of the theoretical framework that undergirds the analysis. Ban describes four factors that influence how global neoliberal scripts are “edited” by local translators. One variable-based way to grasp the argument is that if all four factors take certain values (“high” historical levels of openness, moderate dependence on neoliberal-oriented transnational networks, high levels of institutional cohesion, relatively high capacity to resist coercion from external forces), we end up with the “embedded” type; if the variables take the opposite values, “disembedded” neoliberal policy regimes are the more likely outcome. If there are only two ways in which these factors can be configured, then there is no need to theorize further; one kind of configuration (high openness, moderate dependence, high cohesion, low vulnerability) feeds into one type (embedded), and the other kind (low, high, low, high) generates the other type of policy regime (disembedded). But there is nothing in the theoretical framework that suggests that these are the only possible configurations. I craved more extensive theorizing of what other kinds of policy regimes might be produced by these alternative possible configurations—and how we could go about testing for these alternatives.
This brings me to another question: How should the arguments in this book be evaluated? Ban justifies the research design, which is a paired comparison of the Spanish and Romanian cases, on several grounds (pp. 28–30). He briefly notes that the “scope of the book” extends to the “semiperipheral and postauthoritarian European contexts.” I could not uncover the rationale for these scope conditions; the arguments certainly seem to me to apply more widely. And even if the arguments are limited only to postauthoritarian, semiperipheral states (with the first condition being conceptually clearer to me than the second), I would have more confidence in the external validity of the typology if more cases than just Spain and Romania were examined—even if those additional cases were not investigated with the depth of knowledge that Ban brings to his primary cases.
The case selection rationale in Ruling Ideas does not match either the “most similar” (two cases matched very closely on the key observable explanatory factors but that vary on outcomes) or “most different” (comparing cases that vary widely on key independent variables but look similar on the outcome of interest) logics. Spain and Romania diverge in many ways—not least of which is their relative levels of economic development. (According to data from the IMF’s World Economic Outlook, in 2016 GDP per capita in Spain was 186% higher than in Romania—a difference that shrank from a near 800% gap observed in 2000.) Looking at carefully chosen “out of sample” cases to see how well or poorly the argument travels is one way to establish the external validity of the arguments. Testing for external validity is important because we want to ensure that the theoretical typology and the explanation for observed variation in types applies to more than just two cases; in extending Ban’s novel framework, we want to have a sense of the representativeness of the Spanish and Romanian cases, and I think that the book is lacking on this front.
Dorothee Bohle and Bela Greskovits’s earlier work (“Neoliberalism, Embedded Liberalism and Neocorporatism,” West European Politics, 30(3), 2007) seems to suggest a natural set of additional comparative cases: Their description of the Baltics bears a striking resemblance to the “disembedded” type, and they even apply the “embedded neoliberalism” descriptor to the “Visegrád” countries in central Europe. Going beyond the two cases would have also addressed concerns about what Andrew Bennett (“A Lakatosian Reading of Lakatos,” in Colin Elman and Miriam Fendius Elman, eds., Progress in International Relations Theory, 2003) calls “use novelty” standards of theorizing, by which he means the ability of theories to explain new cases that are independent from the cases that may have influenced the construction of the theory.
These concerns notwithstanding, thanks to Ban’s innovative theorizing and extensive empirical research in two interesting cases, we now have new directions to pursue when it comes to the question of how global neoliberal ideas have transformed national policy regimes.
