The Economic Analysis Underlying the 'Third Way'

This essay seeks to outline the type of economic analysis that we perceive to be involved in the economic policy prescriptions of the ‘third way’. In the UK, the emergence and then election of ‘new Labour’ has been closely associated with the development of the notion of the ‘third way’. Tony Blair, for example, has stated that ‘New Labour is neither old left nor new right ... Instead we offer a new way ahead, that leads from the centre but is profoundly radical in the change it promises’. In a similar vein, Anthony Giddens appears to locate the ‘third way’ by reference to two other ways of ‘classical social democracy’ and neoliberalism.