The 21st century and its challenges: Reconsidering the Keynesian state
| Published date | 01 April 2011 |
| Date | 01 April 2011 |
| Pages | 39-46 |
| DOI | https://doi.org/10.1108/20425961201000029 |
| Author | Oliver Mutanga1 |
| Subject Matter | Public policy & environmental management |
World Journal of Entreprenuership, Management and Sustainable Development, Vol. 7, No. 1, 2011
INTRODUCTION
A lot has been said and debated on the role of the
state and its relation to economic development (Perry,
2002; Purcell 2002; Valocchi, 1989). Most of these
debates have centred on two extremes, one which is
occupied by advocates of the laissez faire approach
while the other end is occupied those who argue for
an interventionist approach. Advocates of the laissez
faire state (International nancial institutions; John
Williamson; Adam Smith) argue that free-market ap-
proaches with no state intervention are the best for
development. Those who advocate for a strong in-
terventionist state (Noam Chomsky; John Maynard
Keynes; Robert Pollin; Joseph Stiglitz) are however,
of the view that strong state intervention in regulating
economic activities is the best form of governance.
While debates have been on the best way to achieve
development, few attempts have been made at ana-
lysing the role of the state over the years and its sig-
nicance towards sustainable development.
This article aims to take a historical analysis of
the role of the state in an effort to show how the state
ought to behave under the current global challenges
in the nancial and climate front. Possible explana-
tions to the causes of the current global challenges
that threaten sustenance of the planet are discussed
and concluding recommendations on the role of the
state will be made. A literature review was conduct-
ed to analyse international experiences regarding to
the role of the state.
The 21sT CenTury and iTs Challenges:
reConsidering The Keynesian sTaTe
Oliver Mutanga1
University of the Free State, South Africa
Abstract: The article advances the argument that there is a great need for reconsidering States’
role in regulating socio-economic, environmental and political spheres. The period of the collapse
of communist economies has seen the private market led system being seen as rational. State
intervention was seen as an impediment to successful development. Banks, insurance companies and
stock markets have done much in the last decade to free themselves from State rules and regulations.
On the Climatic front, most of the challenges that are confronting the world today have their roots
in the by-products of the activities of private led economics. With the failure of the laissez-faire
policies in 2008, a reassessment of the role of the State is needed. Using empirical data through data
review, this article gives the importance of reconsidering the role of State by revisiting the concept
of the State, not as an institution where those who scorn it as an impediment to growth only realise
its importance when the ills of private capital accumulation needs to be repaired through rescue
packages.
Keywords: capitalists, free market, laissez faire, interventionist, recession, state, sustainable
development.
1 Oliver Mutanga, Masters in Development student, Centre for Development Support, University of the Free State in South
Africa, Email: oliverm.junior@gmail.com
Copyright © 2011 WASD 39
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