Power and Regulation in Britain

With the sell-off of the nationalized utilities, regulation became central to the way Britain is governed. The withdrawal of state ownership and provision, however, challenges agency models of state power, which suggest that state capacity increases only with increased resources. This paper suggests that distinguishing between direct and indirect power explains how diminishing state intervention can enhance state control. After reconceptualizing regulation in terms of these two media of power, the paper examines British utility regulations as the operations and effects of marketizing delegation. It shows how market processes operate as a medium of indirect control, permitting the core state to hold direct power in reserve and enhancing overall state power.