The Political Economy of the Regulation School and the Flexible Specialisation Scenario

There have been a number of attempts to develop the Keynesian prescription of demand management to current neo‐liberal economic strategies. The arguments presented by the “French” regulation school and the “American” flexible specialisation scenario are examined to determine whether they are sufficiently coherent and robust to represent a new political economy model to challenge neo‐liberalism. The two models are analysed separately: the main hypotheses and points are outlined and the validity of the main criticisms against each is examined. It is concluded that neither represents a fully fledged political economy model but that some of the ideas developed by either may influence policy on a pragmatic and ad hoc basis.