According to Phillip Bobbit (in “Shield of Achilles”) - we are undergoing a transition in constitutional form from a Nation-State to a Market-State.

Why is this happening?
This is the consequence of what he terms the “Long War”, the period beginning in 1917 and ending in November 1990. The Long War brought significant change - nuclear weapons, advances in communications, and computer technology - and resulted in serious challenges to the legitimacy of the nation-state. The nation-state had added the promise of providing economic security and public goods to its people (in addition to security and political and civil rights that were the promise of preceding constitutional forms). With increased globalization, the nation-state is less capable of delivering improvement to the welfare of its people. Therefore, Bobbit argues that we are in transition to a constitutional form that is based on the promise to improve and expand opportunities to the public.

What are the characteristics of the “market-state”?

• Depends on international capital markets and to a less extent, multinational business network to create stability in world economy (As opposed to management by national and transnational political bodies.)
• Political institutions are less representative (but more democratic) than nation state
• Economic success is based on ability to secure more and better goods and services, like nation-state, but in contrast it does not see the state as more than a minimal provider or redistributor.
• Exists to maximize the opportunities enjoyed by all members of society (no longer instrument to serve welfare of the people - no longer concerned with unemployment rate)
• Pursues objectives by incentive structures and sometimes draconian penalties to prevent social instability (rather than process oriented rules and regulations of nation-state)
• Market state is classless and indifferent to race and ethnicity and gender, yardstick for evaluation is quantifiable.