Legal pluralism, private power, and the impact of the financial crisis on the global political economy

Abstract

∗ Cohen, E.S., 2013. Legal Pluralism, Private Power, and the Impact of the Financial Crisis on the Global Political Economy. Onati Socio-legal Series (online), 3 (4), 679-701. Available from: http://ssrn.com/abstract=2269667 Abstract Private corporate actors have played a central role in the construction of the legal rules of globalized capitalism over the past four decades. In no sector has this been more true than in global finance, where private agents have reshaped the norms and practices of credit creation and allocation. The global financial crisis, however, has led many states to challenge aspects of this power and raised broader questions about the legitimacy and future of private power in the global legal order(s). In this paper, I argue that - while state actors have clawed back significant power in global finance - the specific powers of credit creation and allocation combined with the structural pull of transnational legal pluralism will enable major private financial institutions to retain substantial power in the face of these challenges and questions. In the process, I present some broad suggestions about how we can think about private power in the making of global commercial law.