State in Comparative Perspective

State in Capitalist Economies

The nature of the state cannot be understood through a single model. There is no one universal form of the state which all political systems approximate; rather, the state is a historically conditioned entity whose character varies with the mode of production, the stage of capitalist development and the particular balance of social forces within each society. Comparative politics therefore studies the state across different contexts: advanced capitalist economies, socialist economies, welfare states and the developing societies of the Global South. Each context produces a distinctive state form, and the differences are as instructive as the similarities.

Advanced capitalist states include countries like the USA, the UK, France, Germany and Japan. They are economically the most developed states in the world, with high per capita incomes, sophisticated industrial and financial structures, and powerful corporate sectors. Even after decolonisation, these states continued to dominate the world through capital, technology and military power, and their domestic political systems were consolidated around the institutions of liberal democracy. In such countries, the state may work mainly as a welfare state, a regulatory state, or some combination of both, depending on the particular welfare regime and political settlement in place.

However, the advanced capitalist state is no longer the confident welfare-democratic state of the post-Second World War decades. It has given way, in the assessment of many scholars, to what is called the post-modern state, a state whose sovereignty, identity and authority are no longer organised in the way they were in the classical Westphalian model. The post-modern state is different: its sovereignty is shared, its economy is globalised and its society is multicultural and fragmented. Five features define this new form of statehood.

The first feature is the decline of absolute sovereignty. The classical state claimed undivided authority over its territory; the post-modern state accepts that sovereignty is pooled, shared and qualified. Membership of the European Union, for example, involves the transfer of competencies to supranational institutions, and even outside such arrangements, global financial markets, international law and transnational corporations exercise powers which the old sovereign state would not have tolerated. Sovereignty in the post-modern condition is less a wall around the state than a resource to be negotiated.

The second feature is the regulatory state. The state no longer always directly produces goods and services; instead, in sectors such as telecommunications, energy, transport and finance, it sets the rules of the game and leaves production to private actors. The regulatory state writes standards, supervises markets, issues licences and enforces competition, and its power is exercised less through ownership than through rule-making and oversight. Third, the digital-surveillance state has emerged as states deploy digital identity systems, predictive policing, biometric databases and large-scale data collection in the name of security and administrative efficiency. The same technologies which empower citizens as consumers of public services also equip the state with unprecedented capacities for monitoring and control.

The fourth feature is welfare restructuring. The old welfare state has been reduced and made more market-linked: benefits are made conditional, services are contracted out, and the language of social rights gives ground to the language of activation, conditionality and workfare. Fifth, identity fragmentation has become the normal condition of advanced capitalist societies, which are no longer culturally homogeneous. Migration, multiculturalism and the politics of recognition have complicated the old class-based party systems, and the cultural questions of identity now unsettle the political order to a degree unknown in the earlier capitalist era. Thus the post-modern state is actually an unstable stage in the progress of the capitalist state; it is less national, less sovereign and less solidaristic than its predecessor, and it remains an open question whether it can reproduce the social cohesion on which stable democracy depends.

In practice, nations and states have often become almost synonymous because the modern state created the nation as much as the nation created the state. The nation-state has been the fundamental unit of modern politics, and the identification of a bounded national community with a sovereign political authority seemed the natural telos of political development. But this model is now under pressure from two sides. Internally, ethnic, religious and linguistic forces challenge the homogeneity of the national community and demand recognition, autonomy or secession; externally, globalisation, regional integration and transnational flows erode the boundary which the nation-state was supposed to secure. Yet it is wrong to conclude that the nation-state has collapsed. During the COVID-19 pandemic, border controls, lockdowns, welfare provision and vaccination campaigns were all organised by the state, and the event demonstrated both the persistence of state capacity and its dramatic reassertion in moments of crisis.

The capitalist state is usually presented as a liberal-democratic state. It protects civil liberties, holds regular elections, maintains an independent judiciary and a free press, and secures the rule of law. However, Marxists argue that the capitalist state is not neutral. It only protects private property and the interests of the capitalist class, and the formal freedoms of liberal democracy conceal the substantive inequalities of the capitalist economy. On this view, the state is an instrument of class domination, and its legal and political forms are shaped by the requirements of capital accumulation. Recent developments give some support to this view: capitalist democracies still have strong courts, elections and civil societies, but they have also witnessed a marked concentration of wealth, the capture of policy by corporate interests and a widening gap between formal democratic equality and substantive economic inequality.

The most important recent trend in capitalist countries is democratic backsliding. Democratic backsliding means the gradual, often legal, erosion of democratic institutions and procedures: the weakening of checks and balances, the politicisation of the judiciary, the curtailment of press freedom and the manipulation of electoral rules. Populism is central to this trend. In advanced capitalist countries, right-wing populism has grown on the back of migration, economic insecurity and cultural anxiety, and populist leaders have often used the language of the people against the institutions of liberal democracy itself. The coexistence of formally democratic structures with increasingly illiberal practices is one of the defining pathologies of the contemporary capitalist state.

State in Socialist Economies

Classical Marxism expected the state to wither away after the abolition of class society. Since the state was, on the Marxist view, an instrument of class domination, the establishment of a classless society was expected to render it superfluous and to begin the transition to a stateless communist order. In practice, however, socialist states did not wither away. On the contrary, the experience of actually existing socialism produced states which were vastly more powerful, centralised and intrusive than their capitalist counterparts, and the state assumed direction of the entire economy through nationalisation, central planning and the administrative allocation of resources.

The USSR collapsed in 1991, and many post-socialist states adopted elections and markets. This was described by Francis Fukuyama as the end of history, the claim that liberal democracy and the market economy had triumphed as the final form of human government. Yet the transition to liberal democracy has been uneven. Russia has moved towards authoritarian nationalism, combining formal elections with the consolidation of personal power, the suppression of opposition and the use of energy resources as an instrument of foreign policy. China has combined one-party rule with market-led growth and digital surveillance, retaining the political monopoly of the Communist Party while liberating the economy in crucial respects, a formula which its leadership describes as socialism with Chinese characteristics. North Korea remains a closed, militarised and totalitarian system, organised around the personality cult of its ruling dynasty and insulated from the global economy.

Thus the socialist state did not disappear into stateless communism. It either collapsed into post-socialist states which have followed divergent paths, or mutated, as in the Chinese case, into a distinctive hybrid which defies the simple dichotomy of capitalism and socialism. The trajectory of the socialist state therefore demonstrates that the form of the state is determined less by ideological proclamation than by the balance of social forces, the structure of the economy and the strategic choices of ruling groups.

Welfare State

The welfare state is a form of state in which the government assumes responsibility for the economic and social welfare of its citizens, through the provision of social security, public health, education, housing and income support. Its historical roots lie in the responses to the Great Depression, the demands of organised labour and the social dislocation of the Second World War, and its classical expression is found in the post-war settlements of Western Europe, where the state was assigned an active role in managing demand, securing full employment and guaranteeing basic welfare as a matter of social right.

Different welfare regimes structure this responsibility in different ways. The Nordic social-democratic model, exemplified by Sweden, Norway and Denmark, provides generous, universal benefits financed by high taxation; the conservative-corporatist model of Germany and France ties benefits to employment status and maintains a strong role for the family; and the liberal model of the United States and the United Kingdom relies more heavily on means-testing, markets and private provision. The welfare state thus varies not merely in the level of spending but in the underlying conception of citizenship, solidarity and the proper boundary between state and market.

The welfare state has always had its critics. The minimal state is associated with classical liberalism and libertarianism. It means a state with limited functions, chiefly the protection of life, liberty and property, with defence, policing and the enforcement of contracts as its core tasks. Its leading theorists, from John Locke and Adam Smith to Robert Nozick, argue that a state which goes beyond these functions violates individual freedom; redistribution is coercion, and the compulsory transfer of resources from one citizen to another is morally indistinguishable from theft. The argument in favour of the minimal state is that it protects individual freedom, limits bureaucracy, reduces the burden of taxation, and releases the energies of the market for the creation of wealth.

The recent global experience, however, also shows the limits of the minimal state. The COVID-19 pandemic, the climate crisis, mass unemployment and the growing inequalities generated by globalisation have all demonstrated that markets cannot by themselves secure public health, environmental sustainability or social protection. In each of these domains, states were compelled to intervene on a massive scale, and the pandemic in particular rehabilitated the idea of the state as insurer of last resort. The old welfare state, meanwhile, has in the advanced capitalist countries been restructured and made more market-linked: benefits are made conditional, services are contracted out, and the language of social rights gives ground to the language of activation, conditionality and workfare. In the developing world, the welfare ideal has re-emerged in a new guise as the inclusive growth state, which combines market-based growth with direct welfare schemes, cash transfers and social protection programmes.

The welfare state therefore remains an essentially contested category. Its achievements in reducing poverty, equalising life chances and stabilising democratic capitalism are difficult to deny, yet its fiscal sustainability, its efficiency and its compatibility with the discipline of global markets remain open questions. The contemporary trajectory is not the simple expansion of the welfare state on the old model, but its continuous renegotiation under the pressure of ageing populations, migration, automation and the changing structure of the family and of work.

State in Developing Societies

Developing countries are mostly post-colonial societies. They are also called the Global South, and they continue to bear the institutional and economic legacies of colonial rule: administrative systems built for extraction rather than welfare, economies structured around primary commodity exports, and social cleavages which colonial policy often deepened. The state in these societies is best studied through concepts developed specifically for the post-colonial condition, among them Riggs' prismatic society, Myrdal's soft state and Huntington's theory of political order. Riggs used the idea of the prismatic society to describe a social formation suspended between the traditional and the modern, in which formal institutions of the Western type coexist with informal social realities, and behaviour inside them is governed less by formal rules than by patronage, kinship and communal loyalties. Myrdal spoke of the soft state to capture the low capacity of such states to enforce their own laws and policies, and Huntington insisted that in developing societies the crucial variable is not the level of participation but the level of institutionalisation, for rapid mobilisation in the absence of strong institutions produces instability and authoritarianism rather than democracy.

The post-colonial state was often seen as an entity standing above society. Hamza Alavi called it an overdeveloped state, arguing that the colonial state was disproportionately elaborate and militarised relative to the weakness of indigenous class structures, and that after independence this overdeveloped apparatus persisted, mediating between the metropolitan bourgeoisie, the indigenous landed elites and the emerging national bourgeoisie. On this view, the post-colonial state enjoyed a relative autonomy which the classical Marxist theory of the state could not explain. But this autonomy was limited. The post-colonial state was also shaped by landed elites, industrial bourgeoisie, and the pressures of foreign capital and international financial institutions, and its policies were consequently a compromise between developmental ambition and class constraint.

In the early post-colonial period, the state was expected to lead nation-building and development. It built public enterprises, universities, dams, steel plants and planning commissions; it promoted national identity through language, education and public symbols; and it assumed the role of the principal engine of industrialisation. The developmental state of this era was strongest in East Asia, where states like South Korea, Taiwan and Singapore combined state direction of the economy with export-oriented growth, but it also appeared in India, Brazil and much of post-colonial Africa, where the state was regarded not merely as a regulator of development but as its primary architect. After the 1980s and 1990s, however, liberalisation changed the role of the state. Fiscal crises, the debt crisis and the conditionality attached to loans from the International Monetary Fund and the World Bank forced developing states to withdraw from direct production, privatise public enterprises, open their economies to trade and investment, and reorient themselves towards global markets.

In the 21st century, the developing state has become an inclusive growth state. It combines market-based growth with welfare schemes, direct cash transfers, food security programmes, health insurance and employment guarantees, seeking simultaneously to accelerate growth and to manage the political demands of its citizens. At the same time, the developing state is now also a digital state and a climate state. It must issue digital identities, deliver services through technology, regulate platforms and data, and at the same time respond to climate change, energy transition and environmental degradation, all while its fiscal and administrative capacities remain limited and its legitimacy is perpetually contested between democratic and authoritarian alternatives.

The modernisation thesis argued that economic affluence creates stable democracy. It suggested that as societies become wealthier, more urbanised and more literate, the conditions for democratic politics ripen, and that development, in the words of Seymour Martin Lipset, is the social requisites of democracy. India, however, remains an exception to this thesis. India adopted universal adult franchise in 1950 despite poverty, illiteracy and ethnic diversity which the thesis considered fatal to democracy, and it has sustained democratic politics for more than seven decades, through wars, famines, insurgencies and economic crisis. India's success can be explained through several factors: the institutional inheritance of elections, courts, a free press and an independent bureaucracy; the accommodative strategies of its founding elite, who bet on democracy as the instrument of nation-building; the federal structure which makes the political system responsive to regional and linguistic diversity; and the social mobilisations of lower castes and marginalised groups which have repeatedly renewed the democratic project from below. Indian democracy, however, also faces issues of money and muscle power, criminalisation of politics, polarisation and the erosion of institutional autonomy, none of which the modernisation thesis equipped the comparative scholar to predict.

While comparative politics seeks to find answers by comparing states, many modern concepts of state and politics carry the imprint of the West, and their application to the developing world requires caution. European state formation, for example, often involved centralisation, war-making and nation-building over several centuries; in many post-colonial societies, the sequence was reversed, with the state arriving before the nation and with territory fixed by colonial boundaries rather than by wars of consolidation. Western secularism emerged from church-state conflict, whereas there was no such conflict in India, where the opposite problem arose: a state which must negotiate the co-existence of multiple religious communities. Western class politics, similarly, cannot fully explain caste, tribe, ethnicity and community politics in India and other post-colonial societies, where social stratification follows lines which the Eurocentric categories of class analysis were never designed to capture. Therefore, modern constructs are useful but not sufficient. While we should not reject them completely, we must use them critically, supplementing them with indigenous categories and with attention to the specific histories and social structures of the societies under study.

Changing Nature of the State

The state is an essentially dynamic entity, and the comparative study of the state is in large part the study of its transformation. The classical model of the state, most powerfully articulated in the European tradition from Bodin and Hobbes to Weber, presented it as a sovereign, territorial and centralised authority which enjoys a monopoly of legitimate violence within its borders. This model has been subjected to sustained pressure from globalisation, which weakens state control over capital, information, migration and even security; from the rise of supranational and subnational authorities, which erode the exclusive character of state power; and from technological change, which transforms the very instruments through which the state governs.

Across different parts of the world, the state is continuously changing, and its trajectory varies with the political economy of each region. In advanced capitalist economies, the state has become post-modern, regulatory, digital and security-oriented, pooling its sovereignty, retreating from direct production and expanding its capacities for surveillance. In post-socialist countries, the state has often become authoritarian or party-led capitalist, with political control retained by a dominant party even as market mechanisms are introduced into the economy. In developing societies, the state remains a developmental and welfare agency, but it also faces pressure from global capital, climate change and digital transformation, and it must reconcile its developmental ambitions with the discipline imposed by global markets and international financial institutions.

Several competing models describe what the contemporary state is becoming. The minimal state, defended by classical liberalism and libertarianism, holds that the functions of the state should be confined to the protection of life, liberty and property, and that taxation for redistribution violates individual freedom. Its weakness, however, is that formal liberty does not mean real liberty: a poor, illiterate or sick person may be legally free but practically helpless, and in developing societies a purely minimal state would increase inequality and exclusion. The recent global experience also shows the limits of the minimal state: the COVID-19 pandemic, the climate crisis, mass unemployment and the rise of digital monopoly all require active state intervention. When the state itself failed, as it did in the pandemic in several countries, it was not because the state was too strong but because it was too weak. The real question, therefore, is no longer whether the state should be minimal or maximal, but what kind of state is appropriate: the arbitrary state, the minimal state, the welfare state, the developmental state, the regulatory state or the enabling state.

The welfare state, the developmental state, the regulatory state, the digital state and the security state are not mutually exclusive alternatives; the 21st-century state is typically a combination of several of them. While globalisation weakened the old sovereign state, crises brought the state back. The pandemic, the global financial crisis, the climate emergency and the new geopolitical competition have all demonstrated that societies cannot dispense with the coordinating, protective and redistributive capacities of the state. The 21st-century state is not minimal. It is multi-layered: it governs through law, market, data, security and international networks simultaneously, and it acts at once on the domestic and the transnational level. It is in crisis, but it is also resilient; it is constrained, but not irrelevant; it is transformed, but not dead.

Finally, the comparative study of the changing state must also confront the Eurocentrism of its own analytical categories. Concepts such as sovereignty, the nation-state, secularism, citizenship, civil society and development emerged largely from European history, and they cannot fully explain non-Western societies. In Europe, state formation often involved centralisation, war-making and nation-building; in many post-colonial societies, borders were drawn by colonial powers, not by organic national development, and the state preceded rather than followed the nation. Western secularism emerged from church-state conflict, whereas there was no such conflict in India, where religion gave a basis to the state in ancient times and the modern state must instead negotiate the coexistence of multiple religious communities. Western class politics cannot fully explain caste, tribe, ethnicity and community politics in India and Africa. Modern constructs, therefore, are useful but not sufficient. We should not reject them completely, but we must be careful not to apply them mechanically; comparative politics must provincialise Europe, treating the European experience as one experience among many rather than as the universal model against which all societies are to be measured.