Political Economy of Digital Capitalism

How does politics shape the course and character of digitalization?

We live in times where hardly a day goes by without some digital company making headlines for revolutionizing yet another aspect of our economic and social lives. These changes often have a peculiar double-dynamic.

The double-dynamic of digitalization

First, they have a commodifying thrust, pushing economic logics ever deeper into the social fabric. Work is reorganized on digital platforms in ways that undermine existing (labor) regulations; individuals are nudged to disclose previously personal information such as health choices or reading habits as privacy increasingly comes at a cost; and new markets are created that subtly introduce opportunity cost considerations into people’s daily lives (do I lose money if I don’t sublet my spare room on Airbnb?).

Second, they have a disruptive thrust, radically altering the requirements for success, on the individual-, firm-, and national level. Relatively rapidly, skills become obsolete, markets disappear, competitive advantages vanish, and entirely new physical and social infrastructures become increasingly essential.

Varieties of Digitalization

The double-dynamic of digitalization confront policymakers with a whole range of challenges, from regulating platform companies, to protecting personal data, to responding to new skill and infrastructure demands. Importantly, policymakers often react very differently to these challenges, and these reactions change the nature of digitalization itself. This variance in policy responses and policy effects creates an El Dorado for social scientists trying to understand why and how digitalization varies, but also why and how capitalist societies differ.

On the one hand, the different trajectories digitalization takes in response to country-specific restrictions and affordances make a big difference in people´s economic, political and social lives. Consequently, technological change is not social destiny but depends on political choices (or non-choices) that can, in principle, be explained.

On the other hand, different reactions to similar challenges reveal something about the the political entities that make them. As the comparativist Peter Gourevitch once remarked: “For social scientists who enjoy comparisons, happiness is finding a force or event which affects a number of societies at the same time. Like test-tube solutions that respond differently to the same reagent, these societies reveal their characters in divergent responses to the same stimulus” 1.

The comparative political economy of digital capitalism

Digitalization is such a reagent. The challenges it poses and the reactions it provokes open up a new field of research: the comparative political economy of digital capitalism. Drawing on the comparativist’s toolkit - developed in explaining earlier politico-economic transformations like globalization - much of my current work tries to explain when and why commodifying trends are reversed - for example by introducing ‘de-commodifying’ data protection or platform regulations; and to explain how disruptive changes are responded to - for example by investing in digital goods such as skills or R&D.


  1. Gourevitch, P. (1977) ‘International Trade, Domestic Coalitions, and Liberty: Comparative Responses to the Crisis of 1873-1896’, The Journal of Interdisciplinary History, 8(2), p. 281.↩︎