THE RISE OF THE CAPITAL-STATE AND NEO-NATIONALISM

Abstract

What explains neo-nationalism – the surge of populist nationalism in the contemporary phase of globalized development? Drawing on Karl Polanyi’s study of the “great transformation” and the mixed methods approach, the study argues that neo-nationalism is a societal protective reaction against the pro-market structural changes in the political economies of nation-states – conceptualized as the capital-state transformation. It shows that there is an inextricable link between free market reforms, declining state legitimacy, and identity-based mobilization. Populist nationalism of both the Left and the Right has emerged to compensate for the real and perceived inability of the state to shield citizens from the corrosive effects of market fundamentalism. The study contributes to our understanding of the dynamics of the inter-related nature of state, capital, and identity politicization through a broader social theoretical perspective.