Economy,state and civil society

The paper identifies a double crisis of agency facing socialists-the inability of the state to act effectively as the agent of society as a whole, and of the party adequately to represent the diversity of people's interests. It argues that this crisis can be resolved by the development of civil society, enabling the exercise of social control over the state and the economy.

An institutional framework for participatory economic democracy is then outlined, based on the author's model of 'negotiated co-ordination'. The model incorporates market exchange, since enterprises use their existing capacity to meet market demand, but not market forces, since interdependent investment decisions are not taken separately by enterprises acting independently, but collectively through negotiation involving all those with an interest in their combined outcome.

The model is constructed on this basic principle of self-government-that decisions should be taken by those affected by them. The conclusion reached is that the dual crisis of agency can be resolved by the development of civil society, but that a role remains for the state, in resolving residual conflicts of interest when negotiation fails to produce agreement, and for political parties, in promoting alternative perspectives on the distribution of resources, rights and responsibilities.