THE MORAL REGULATION OF MARKETS - PROFESSIONS, PRIVATIZATION AND THE ENGLISH INSOLVENCY ACT 1986

Both economists and sociologists in the last two decades have pointed to the variety of ways that markets require normative foundations and legitimation. In order to understand better how market morality is con structed through law, this paper examines how Mrs Thatcher's Conservat ive Government used the 1986 Insolvency Act to produce a reconstructio n of market behavior. First, it championed privatization in the admini stration of bankruptcy and in corporate liquidation and reorganization . To do so required a clean-up of the ''unacceptable face of capitalis m.'' It used the insolvency reforms to develop a moral code that disti nguished among three types of commercial behavior - mistakes, reckless ness, and criminal activity. Second, the Act attempted to ''profession alize'' some elements of business practice. It did so by developing co des that exposed reckless and criminal company directors to civil acti ons with strong punitive sanctions, including personal liability and d isqualification from management. And third, the legislation created a new occupational monopoly of insolvency practitioners, which was charg ed with the monitoring of directors' behavior, and reporting recklesss ness and the appearance of criminality to government enforcement agenc ies. The paper concludes that Mrs Thatcher's Government used the ideal s and actuality of professionalization as an instrument to define and improve both market morality and efficiency. This linkage between prof essionalization and market rejuvenation further demonstrates how state s may use professions as agents of economic surveillance and enforcers of commercial morality. It raises questions about the conditions unde r which states will exert their enormous leverage over licensing to co mpel professions to act as moral agents on the state's behalf.