Power relations through the market: a Foucauldian critique of the competition law in Iran

ABSTRACT

In Foucault’s narrative, neoliberalism is a rationale to delimit government power through certain actions called governmentalisation. This does not mean that individuals are exposed to a despotic state, but a government that warrants laissez-faire and controls through liberty. Central to this act of government is the market in which individuals can freely transact, provided that their conducts comply with the determined disciplines. Governmentality highlights that competition in the market preserves and protects individuals’ interests. However, governmentalisation in developing countries is encapsulated in the concept of good governance. In this case, these governments are encouraged to privatise state-owned enterprises to guarantee a free market while casting off ambitious welfare projects. Iran’s government implemented pseudo neoliberal policies to purportedly unlock the market, while the government is disinclined to lose its authority. This article considers Foucault’s view on governmentality to indicate how Iran’s government governmentalised the market and used competition law to maintain market power. It is argued that Iran’s act of government was a failed project in terms of providing individuals’ freedom while it strengthened well-connected firms.

KEYWORDS:

• Competition law
• governmentality
• discipline
• neoliberalism
• free market

I Introduction

In The Birth of Biopolitics, Foucault discusses historical changes in western societies that transformed monarchic sovereign power into a democratic one. In such transformation, power could no longer remain in sovereignty to command people’s lives. In addition, the supernatural character of laws disappeared, and the sole source of law and order became attenuated.¹ On this occasion, raison d’etat was born. Based on this, states had total interest, and everybody was compelled to defend this, but it did not mean that the state aimed to be an absolute power. Instead, the state was interested in regulating subjects’ behaviour; at the same time, some rules were in force to hinder absolutism. In this respect, raison d’etat opened the hands of its agents, such as the police, to infinitely defend interests while admitting constraints to remain legitimate.²

The legitimacy of the state was of utmost importance, and accordingly infringing those constraints deprived the state of any legitimacy. States used micromanagement or real disciplinary power to influence people’s conduct and enhance their welfare and health.³ By increasing the population and introducing economic analysis, discussion about legitimacy or illegitimacy of power lost its value because the government’s failure or success was determined by good governance. Moreover, states found it difficult to continue the comprehensive plan of disciplines such as the army, police, and so on to target individuals’ bodies through mass surveillance. Hence, states handed over some of their responsibilities to other agencies, which authorised individuals to manage their conduct with liberty.⁴ In this regard, liberty was not valued intrinsically (a negative right) by the state. The state took advantage of liberalism to determine the conditions of liberty, such as using private property rights in a free market.⁵

Rather than a single sun, which no matter how brilliant cannot light up the entirety of the social landscape, there would be an infinity of suns, illuminating every corner, so that decision and action would have no dark side, no obscurity or secrecy. Liberalism’s project would not be to dissolve this form of social power, but to disperse it, to intensify it and its potential by granting each human being the status of individuality. It would make everyone a king.⁶

Foucault stipulates that free exchange in liberalism was central. Under liberalism, market freedom had tangible effects, states’ intervention became unnecessary, and it required a supervisory role of the government to ensure that the market was running effectively.⁷ He, however, maintains that sole reliance on the free market forces weakened when economic failure emerged. In this case, neoliberalism is an art of government to make a balance between policy and the market.⁸ The neoliberal order is interested in the free market, but entails active governmentality in which the market cannot be separated from the government.⁹ Put less tersely: liberalism dictated that the rationality of any governmental activity had a significant tie to the private interests of individuals in a free market because a free exchange was the cornerstone of the market’s functionality.¹⁰ The liberal theory proposed a political model to rationalise the relationship between individual freedom and ruler.¹¹ In neoliberal governmentality, the government reintroduces itself to the market forces and actively interferes in the market to restrain any failure.

Foucault contends that ‘so long as sovereignty was the major problem and the institutions of sovereignty were the fundamental institution, and so long as the exercise of power was thought of as the exercise of sovereignty, the art of government could not develop in a specific and autonomous way’.¹² Thus, it is not surprising that the Iranian intellectuals, predominantly after the Constitutional Revolution (1906),¹³ felt that a central governing body was missing in Iran; therefore, they ruled out any implication of governmentality. Central to their concerns was the need for sovereign power to secure borders and release the country from foreign interference in the twentieth century. To a lesser degree, a liberal constitutional framework that limited the Shah’s dictatorship seemed necessary.¹⁴ Any plans for governmentalisation stemmed from an arbitrary power that wanted to modernise the country. In one of his essays about the Islamic Revolution (1979), Foucault argues that the Shah (the Pahlavi regime) wanted to liberalise the country without any significant change in the power structure and the economic development failed to build a modern and liberal state in Iran.¹⁵ The situation was changed by the Islamic Revolution. The revolutionary government struggled to build an Islamic nation with its own disciplines. Despite acting as a welfare state to enhance people’s health and well-being, this government confronted economic constraints, compelling it to implement a neoliberal order.

I begin this article with Foucault’s reflections on governmentality and the differences between sovereignty and disciplinary power. After this, the article considers the role of the market in this narrative and how the free market was transplanted into the competition with neoliberal governmentality. Neoliberal policies highlight the importance of competition and reintroduce government intervention to preserve the competitive market. Here, one might doubt the applicability of neoliberal governmentality in Iran due to the different socio-economic and historical circumstances. Despite such differences, it is worth reflecting on ‘a set of force relations’ because power exists everywhere,¹⁶ even though patterns and functionalities might contrast.¹⁷ Hence, part III is allocated to the neoliberal governmentality in Iran and the usage of competition law to strengthen disciplinary power. Further, Iran’s privatisation scheme is considered to analyse how the government makes the people responsible, while quasi-governmental organisations and interest groups take advantage of the privatisation policy. It appears that neoliberal governmentality is misused in Iran to empower the disciplinary side of the government to restrict freedom and foster market power.

II Governmentalisation in a neoliberal sense

In Foucault’s view, sovereign power did not permit any calculation or cost–benefit analysis. It simply imposed absolute power.¹⁸ Social changes, including population growth, economic analysis development, and power constraints, rationalised states and drove them to delegate some sort of control to the market. Although sovereignty has never been replaced by any discipline or government,¹⁹ the existence of this triangle (sovereignty, discipline, and government) characterises a system as neoliberal.²⁰ Governmentality clarifies the modern concerns of security, population, and government, contrasting with earlier problems of sovereignty and obedience.²¹

A Governmentality in Foucault’s literature

Before elaborating on governmentality, it is necessary to determine and define the key concepts in Foucault’s analysis. Further, Iran’s situation is analysed in terms of compatibility with the Foucauldian approach to the power and art of government.

1 Foucault’s toolbox

Foucault draws a triangle between sovereignty, discipline, and government,²² maintaining that the art of articulating elements of sovereignty, discipline, and government separates a sovereign power (i.e. an authoritarian regime) from a neoliberal one.²³ Here, the key concepts and features of forms of power are elaborated.

1.1 Power

Foucault predominantly considers influential forms of power in which ‘the individual is an indeterminate factor in the activation of social power.’²⁴ Based on the Foucauldian approach, power needs a victim, and the victim should have some degree of freedom to be a subject of power.²⁵ Foucault contextualises ‘ … power as relationship and the relationships of power as actions upon actions.’²⁶ Hence, power relations differ from violence and slavery because one is deprived of liberty in these situations.²⁷

1.2 Freedom

In Foucault’s world, one is unlikely to find an idealistic notion of liberty or a free subject.²⁸ Indeed, negative liberty minus power does not exist. In this respect, freedom is associated with power.²⁹ To simplify the relationship between liberty and power, one can contemplate a game in which any move has certain constraints imposed by power. Indeed, freedom is realised by power.³⁰ For Foucault, freedom is a capacity to act and there is no discussion about repressed freedom that should be unchained or released (negative freedom).³¹

1.3. Sovereign power

Foucault maintains that in medieval times, the sovereign power oversaw divine law implementation, while the seventeenth-eighteenth century was the period in which states aimed to expand power with various disciplines. In the nineteenth century, states confronted liberalism, requiring their power to be limited and releasing the market to enhance the population’s prosperity and growth.³² Foucault mentions that power in sovereignty worked as ‘a mean of deduction, a subtraction mechanism, a right to appropriate a portion of the wealth, a tax of products, goods and services, labour and blood, levied on the subjects’.³³

1.4 Disciplinary power

Disciplinary mechanisms emerged to displace sovereign power.³⁴ Disciplines target the entire individual’s body, actions, and behaviour to shape individuality. Hence, consistency and continuity are prominent under disciplinary power to determine the future and create a habit. This aspect requires an efficient system of records to collect whatever individuals perform or communicate; therefore, discipline apparatus can preclude or direct any future acts and thoughts.³⁵ Foucault maintains that ‘discipline ‘makes’ individuals.’³⁶ Disciplinary power considers individuals as objects and means of exercising power.³⁷ This means violent and costly relations such as slavery or exploitation were replaced with more utilised methods. In fact, disciplines enhanced individuals’ body forces in economic terms and, at the same time, rendering them docile.³⁸

1.5 Biopolitics

A technology of power that targets a group of humans (population) to ‘ … incite, reinforce, control, monitor, optimize and organize… : a power bent on generating forces, making them grow, and ordering them, rather than one dedicated to impeding them, making them submit, or destroying them.’³⁹ Although it seems that biopolitics is tied to disciplines, they are in two separate directions. However, they eventually constitute a form of concrete arrangements.⁴⁰

1.6 Biopower

In the Foucauldian narrative, biopower consists of two modes of power,⁴¹ disciplines which are procedures of power to preserve utility and biopolitics which include the regulation of the population.⁴² In biopower, a nation is addressed and the health and stability of social life matter.⁴³ The welfare state is an enormous illustration of biopower in which the government seeks to preserve and increase citizens’ welfare.⁴⁴

1.7 Governmentality

The population is a crucial parameter in governmentality. More concretely, the population is the target.⁴⁵ Government, for Foucault, is associated with controlling and leading a series of actions. In this sense, governmentality means exercising power less spontaneously and using technologies to regulate people's conduct.⁴⁶ Governmentality or art of government refers to 1) political rationality- how the exercised power is conceptualised; and 2) governmental technologies- that include practical mechanisms, instruments, and calculations to achieve governmental aims through individuals.⁴⁷ The nature of the government is revealed by exercising power over the population, and this exercise of power is associated with the tools that the government chooses to govern the people.⁴⁸ Indeed, neoliberalism is not the termination of sovereign or disciplinary power, but the art of governing in the hands of sovereign power.⁴⁹

1.8 Liberalism

In Foucault’s narrative, liberalism was neither an economic theory nor a political one, but an art of governing the population, resulting in the knowledge of political economy. It employed economic reasoning to indicate whether a governmental action was efficient and tried to constrain state power.⁵⁰ The government’s challenge was to make a balance between individuals’ interests and the general interest.⁵¹ Thus, enacting and enforcing laws could not be the only function of the government, and other forms of power were conducted outside the government through various technologies and disciplines.⁵²

1.9 Neoliberalism

Under neoliberalism, states are reluctant to use one sort of power that leads to excessive totalisation. Instead, they cooperate with the market to governmentalise individuals’ conduct. In this respect, governmentality ‘offers conceptual instruments that point to the costs of contemporary forms of government while providing a basis for the invention of new practices and modes of thinking.’⁵³

2 Delocalised governmentality

In the historical context, governmentality accounts for particular rationalisation of power in western countries. In this narrow definition, regions can be split into liberal and illiberal orders. Under the liberal order, individuals enjoy a degree of freedom and power is exercised through a web of relations. On the contrary, in the illiberal region, power is realised through violence and discipline. Notwithstanding this, a general and broader concept of governmentality is accessible in which various forms of power are analysed.⁵⁴ Thus, governmentality demonstrates that power can be implemented through freedom, violence, and coercion. Indeed, art of government underscores a mixture of them in a given society.⁵⁵

Despite this, it is quite fair to suspect governmentality under an authoritarian regime. In other words, the Foucauldian approach to power relations contextualises a liberal order and neoliberalism in such society subsequently. However, as Mitchell Dean articulates, an authoritarian regime, like a liberal government, is identified by elements of biopolitics and sovereignty. In addition, any state is capable of using governmentality to control opposition without granting or respecting individuals’ freedom.⁵⁶ In this sense, non-liberal governmentality can be separated from liberal forms. While in the latter, the concept of limited government, freedom enhancement, and the rule of law are admitted, the former tend to use elements of governmentality differently.⁵⁷

Although Foucault addresses the history of sovereignty, discipline, governmentality, liberalism, and neoliberalism in western countries, identifying how sovereign power is transformed into a government, this does not mean that his arguments do not apply to non-liberal or authoritarian states. In the case of neoliberalism, Foucault does not outline a distinctive concept of neoliberalism which prevails and replaces previous orders. By contrast, he highlights that institutional frameworks and the regime of policies could vary, which yields different neoliberal rationalities.⁵⁸

In this sense, Foucault considers an alignment and shift of other forms of power.⁵⁹ Neoliberal governmentalisation that can be ascribed to western countries stems from their socio-economic conditions. However, these different conditions do not ban any discussion about the applicability of governmentality in Iran, even though implications and power relations might be distinct.

As a matter of fact, Foucault’s narrative on the transition from liberalism to neoliberalism cannot concretely describe the socio-economic movements in Iran. Still, it highlights the characteristics of market governmentalisation after the Islamic Revolution. In Iran, it is unlikely that one could find a coherent discourse about liberalism and its implications for society’s changes. Iranian intellectuals became familiar with liberal thoughts, but there was not a single voice to push back the sovereign power in the twentieth century.⁶⁰ The lack of transparent discourse probably had its root in the sovereignty problem.

B Governmentalisation of the market

Foucault postulates that before the middle of the eighteenth century, the market was a place of justice, not a realm of generating truth which states had jurisdiction over.⁶¹ Following Legendre’s response to Colbert’s question about governmental support for businesses, free exchange without the interference of a third party structured the relationship between the market and the state apparatus.⁶² Here, rationalisation of power happened because the state was no longer the sole creator of truth, and either exchange or competition was the consequence of laissez-faire which formed the principle of the market.

1 A shift from exchange relations to competition

Europe's sixteenth and seventeenth centuries represented the persistence of the new political structure called raison d'etat. In this political rationality, it was assumed that the state could obtain adequate knowledge to govern everything and shape reality. Such rationality needed a maximal state with police, laws, and regulations to govern.⁶³ Some extrinsic constraints such as natural law, divine providence, and so forth separated raison d'etat from the sovereign power, whose focus was ‘a right of seizure: of things, time, bodies, and ultimately life itself.’⁶⁴

Foucault, however, points out that amid the eighteenth century, a transformation occurred in which an intrinsic limitation rationalised the act of government.⁶⁵ States desired to use economic reasoning to justify the plausibility of government intervention.⁶⁶ The state was occupied with conforming to the maximum and minimum strengths that were naturally fixed. A new regime of truth emerged in which the government conducted self-limitation.⁶⁷ Rationality was defined by the freedom of individuals in the market, and during liberalism, the government did not intend to interfere in the market. It was an ideal place for individuals’ free interactions because rational individuals maintained the functionality of the market, and the government benefitted from it.⁶⁸ Hayek also describes it differently, although he attains the same result. In his account, freedom is highly associated with the discipline of civilisation. Indeed, humans who organised in small groups to survive did not have a free choice, but the discipline of civilisation opened doors to freedom.⁶⁹

Foucault explains how the market imposed standards on the police state. Market players could convince the state that individuals had no insights into the mechanisms of the market; therefore, no power over the market. In short, the police state could not create an economic sovereign even though states endeavoured to establish it.⁷⁰ When the market became a place of the formation of truth, unlimited regulatory governmentality was restrained by the norm and rules that the market provided. In the sixteenth and seventeenth centuries, the market was under restrictive measures and regulations to fix prices, determine product types, and so on. By contrast, when the market had to follow its nature, justice as part of a state no longer needed to become a dominant power in the market and bring just or true price because whatever the market ruled was the true price. Here, the market did not need to be just because the market required the government to function according to the truth.⁷¹

In the eighteenth century, an exchange created two equivalent values that inclined parties to be committed to the circulation of things.⁷² Following this paradigm change, governments in Europe found it irrelevant to enforce laws and regulations. Instead, the government preferred to play a supervisory role without intervention⁷³ to ensure that free exchanges were done smoothly and property rights remained respected.⁷⁴ The self-limitation principle was the prevailing character of the eighteenth century in which the state’s interest was not the sole determining factor. Still, interest included ‘a complex interplay … between social utility and economic profit, between the equilibrium of the market and the regime of public authorities … .’⁷⁵

In the nineteenth and twentieth centuries, exchange was no longer a primary market function, but competition was the heart of the market under the neoliberal paradigm. At this point, competition was considered by many to be a phenomenon that could warrant economic rationality. Hence, the government should deprive the market of market power, monopolistic behaviour, and cartelisation. Moreover, it was incumbent on the government to maintain the status quo in the market. To do this, the government must preserve competitive conditions in the market.⁷⁶ However, the ideal is a pure or perfect competition which is unlikely to be attainable.⁷⁷ ‘Pure competition must and can only be an objective, an objective thus presupposing an indefinitely active policy.’⁷⁸ Perfect competition refers to ‘the static state, which was a simultaneous equilibrium in the markets for all inputs in production and in the market for all final goods.’⁷⁹

2 Government should act in the interest of the market

The question of how the government can effectively secure the collective interests of individuals in and through the market needs to be considered. In the liberal view, individuals need the freedom to pursue their goals; therefore, the government must ensure that contractual agreements are enforced, and the market is free from dominant power.⁸⁰ This liberal view restores an individual’s intrinsic right to choose and diverges from the state’s direction.

Under the conditions of liberalism, the market technology of power drew states’ attention. This means that they could shape individuals’ conduct in the market to yield pleasant effects and preclude unpleasant ones. States realised that freedom played a crucial role in governmentality, and market freedom was an instrument to gain authority.⁸¹ Still, under neoliberalism, the government is bound not to restrain and control the freedom of individuals with two preconditions: the exchange is not understood as an intrinsic right; and a fragile system exists that requires active governmentality.⁸² Now, interests are secured by competitive markets, meaning that competition indicates the efficiency of the market. It is not the end goal of any government intervention in the market. In the neoliberal order, ‘one must govern for the market, rather than because of the market’.⁸³ That is why Hayek does not oppose the government’s coercive nature in maintaining order. He stipulates that a society with spontaneous order⁸⁴ entails a minimal government to guarantee the rule of law.⁸⁵

Foucault highlights that ‘neoliberalism should not therefore be identified with laissez-faire, but rather with permanent vigilance, activity, and intervention.’⁸⁶ Moreover, Hayek construes that laissez-faire does not require an anti-state position, but is an argument for limiting state action and proposing proper functions. He further contends that laissez-faire, or non-intervention principles, have no insights into what would be admissible in a free system.⁸⁷

Nowadays, the government monitors conduct in the market via antitrust regulators to preserve its functionality. This purportedly results in maximised efficiency and welfare in the market. It also entails a consequential approach in competition law.⁸⁸ Based on this, regulation is an instrument to maximise welfare, demonstrating that activity in the market is efficient.⁸⁹ It cannot be interpreted however that the government restores its jurisdiction or power over the market. By contrast, individuals are free, albeit responsible for their choices.⁹⁰ This is highlighted when Mises discusses the interrelations between political and economic freedom.

The idea that political freedom can be preserved without economic freedom, and vice versa, is an illusion. Political freedom is the corollary of economic freedom. It is no accident that the age of capitalism became also the age of government by the people. If individuals are not free to buy and to sell on the market, they turn into virtual slaves dependent on the good graces of the omnipotent government, whatever the wording of the constitution may be.⁹¹

The state is disinclined to exercise power with violence, but seeks to structure the individuals’ actions. Freedom is also associated with power. In this sense, power can be only imposed on free people to shape power relations; therefore, freedom is a precondition of the exercise of power.⁹²

III Power relations under Iran’s neoliberal governmentality

In Foucault's view, the neoliberal form of governmentality predominantly is associated with advanced liberal societies whose welfare policies were unsuccessful under the Keynesian approach. In Iran, some aspects of this neoliberal order are traceable. It can be seen that Iran’s government particularly after the Islamic Revolution in 1979 deployed multiple welfare policies to benefit targeted groups in the society. Thus, the government experienced similar circumstances to a failed welfare state and found governmentality a reliable solution to eliminate failures. Despite the fact that Iranian society was not eligible to confront neoliberal governmentality based on Foucault’s angle, Iran’s government conducted a neoliberal project in which distant governance would be applied.⁹³ In this regard, one should use failed governmentality to distinguish such a policy from neoliberal governmentality. In failed governmentality, government preserves interventions, showing that it tends to act as disciplinary power and regulate the population using laws.⁹⁴ It is argued that the Iranian postrevolutionary government represented a form of failed governmentality with negative impacts on individuals’ freedom.

A Iran’s neoliberal art of government

The Shah’s welfare plans were mostly connected to a corporatist welfare system. In this sense, mass population was not targeted, and only some social classes such as government employees, industrial workers, military officers, etc. could benefit from welfare policies.⁹⁵ In addition, the Shah also favoured a split between political and economic spheres, protecting local businesses to alienate them from any demands for democracy. In this view, the government could mobilise financial resources and legal instruments to protect local businesses as long as they followed the government’s scenario. In this scenario, the Shah’s and technocrats’ discretions were prominent in determining licences, tariffs, the competitiveness of the market, etc. Indeed, the policymakers realised the level of modernisation, and they should be satisfied with the outlines of projects instead of market forces.⁹⁶

On the contrary, the Islamic Revolution was committed by establishing social justice and eliminating poverty.⁹⁷ Apart from this, the revolutionary government deployed various disciplines and orders to create docile subjects based on Islamic thoughts to monopolise power.⁹⁸ Hence, the government not only continued the welfare plans of the former regime, but also expanded them by establishing new mobilising institutions such as relief committees, social security system, health care, and so forth. Distribution of basic goods and subsidies was also implemented to include more vulnerable people. Welfare policies resulted from multiple promises that the revolutionary state reiterated. For instance, in his speech after the Shah’s overthrow, Ayatollah Khomeini stated that the government must provide the impoverished class with free water and electricity. In his literature, the poor are part of an oppressed (Mostazafan) class whose demands were excluded by the Shah’s administration.⁹⁹

Despite this, after a decade of loose welfare policies, politicians in the postrevolutionary government faced a difficult choice between dissolution or modernisation.¹⁰⁰ In this case, it can be said that neoliberal policies were undertaken to cut the financial burdens, restructure organisation of the government, and redefine the relationship between ruler and ruled individuals to the extent that power centralisation was not weakened. However, this shift should not be interpreted that Iran’s government enthusiastically preferred to abide by neoliberal rules of governmentality. Indeed, the proposition still echoed Khomeini’s viewpoint:

The government ought to supervise. For instance, they should allow people to be free to bring in those goods which they need from abroad. Both the government and the people should bring (goods) to the extent that they can, but the government should supervise concerning goods that are contrary to the interests of the Islamic republic; that are contrary to the Islamic laws and disallow their imports. This indeed is supervision.¹⁰¹

The postrevolutionary government decided to alter roles and responsibilities due to economic constraints. In the first step, the government conceded that its power was limited. Apart from this, the government recognised that comprehensive market control would also threaten its power because total control required massive violence that might render subjects incapacitated or even dead. ¹⁰² That is why an authoritarian state might prefer to use other disciplines in tandem with pseudo market freedom. In this sense, governmentality contributes to authoritarians’ survival, and they can determine the political sphere and arrange the power relations with governmentality.¹⁰³ In this context, the situation was complicated by the prescriptions of the International Monetary Fund (IMF) and World Bank, which included structural adjustment for developing countries like Iran. In other words, Iran’s government aimed to governmentalise the power by implementing structural adjustment. This refers to four central policies on stabilisation in the economy by controlling inflation, reducing public expenditure, balancing payments; liberalising trade and capital flow; deregulation of unnecessary restrictive laws of prices; and privatisation of formerly nationalised or expropriated enterprises.¹⁰⁴

After the Iran-Iraq war, Iran’s government seriously considered governmentality following the IMF’s and World Bank’s recommendations. In 1989, the parliament ratified Iran's First Five-Year Economic, Cultural, and Social Development Plan.¹⁰⁵ The preferred method was negotiating with potential buyers of state-owned enterprises (SOEs). This method, together with the inflationary impacts of structural adjustment, prompted some elites to oppose privatisation. In 1994, conservatives took the majority in the parliament. They enacted a law to restrict sales of SOEs to the private sector while allowing the government to transfer them to veterans of the Iran-Iraq war.¹⁰⁶ This was the cornerstone of quasi-governmental organisations’ engagement in privatisation because veterans had insufficient financial resources, so foundations (bonyads) were established to represent them.¹⁰⁷

Notwithstanding this, the IMF emphasises good governance. Its definition includes the efficiency of economic policies, regulatory framework, and the rule of law to strengthen competition,¹⁰⁸ but Iran’s attitude diverged from this definition. Further, governmentality in developing countries can be divided into two parts. Part one refers to the rationality of the government, and part two insists on technologies of implementation. While the IMF and World Bank rationalise such policies, the capacity and conditions of the society to carry the weight of such reforms is not guaranteed.¹⁰⁹ For example, in Iran’s case, the government’s goal was followed by quasi-governmental organisations to target individuals’ behaviours in the market. Although the notion of competition and the role of private sector were recognised, this approach did not result in a free market.

B Stabilising authoritarianism through the market

As mentioned earlier, neoliberalism maintains that it is the government’s responsibility to protect the market from anticompetitive actions such as concentration and market power. Similarly, despite its authoritarian approach, Iran’s government does not neglect the market. The authoritarian approach needs the active participation of quasi-governmental organisations whose power can arbitrarily change the direction of the market. In this case, Iran can utilise a pseudo market freedom with a centralised plan.

1 Iran’s competition law and market power

Under neoliberalism, the utilitarian approach still plays a significant role in the market by leading the mechanism of protecting competition.¹¹⁰ Neoliberal governmentality can also be fostered in a competitive market. In a utilitarian approach, interest matters, and exchange value is the measure of utility.¹¹¹ By introducing utilitarianism,¹¹² a split occurred between the market and the government. This economic analysis, or rather, an interest-based attitude, brought limitation of state power. Accordingly, government intervention was measured by the principle of utility.¹¹³ In fact, the novelty of governmentality ‘consists in an interventionist state which creates conditions for the artificial or purely competitive market in which homo economicus makes choices as rational self-entrepreneur.’¹¹⁴

Government intervention is justified by rendering the market competitive; therefore, oligopolistic or monopolistic behaviours should be prohibited. Depending on the economic viewpoints, various definitions of market power may occupy one’s mind. These definitions, however, concentrate on the role of firms that can enormously influence the market. In Iran, ‘competition is a situation in the market in which … none of the producers, buyers and sellers shall have the power to determine market prices, and there is no restriction on the entry of the firms to the market or their exit from it.’¹¹⁵ Moreover, the Law on Implementation of General Policies of Principle (44) of the Constitution (LIGPPC) maintains that the market should be immune from dominant economic conditions.¹¹⁶ In this sense, market power is when a firm or group of firms raise or maintain prices regardless of the competition.¹¹⁷ Based on article 1 of LIGPPC, the dominant economic condition refers to ‘a market situation in which one or several legal or real entities have the power to determine prices, set supply or demand limits for goods or services or lay down conditions of a contract.’

Theoretically, the government created a competition framework in which people were allowed to compete freely, and the market was acknowledged to determine the truth. This is the conduct of conduct, meaning that free individuals are the subjects of the power being exercised by the government.¹¹⁸ As Foucault characterises it, truth is not a universal phenomenon, but an arbitrary and conditional one often identified by power.¹¹⁹ Here, by engaging quasi-governmental organisations, the government (un)intentionally occupied the market with a new power relation that made state-sponsored market power an inevitable part of the economy. Under article 6 of LIGPPC, quasi-governmental organisations fall into the definition of public, non-governmental organisations that are permitted to do business ‘ … unless their performance caused disruption to competition.’ These organisations and institutions are also ‘ … obliged to report the entire direct and indirect ownership of all their subordinate and affiliated companies in production and services markets to the competition committee every six months.’

In Foucault’s terms, power is associated with the instruments, techniques, and procedures used to influence a person's actions with multiple choices of behaving.¹²⁰ Thus, market power might compel an individual to enter an agreement, prevent one from doing business with a third party, or restrict one from using his property.¹²¹ In this regard, market power goes beyond the economic system and, at the same time, may be affected by the economic system in which the government plays a crucial role in stabilising market power.¹²² Notwithstanding this, it is not warranted that the government preserves a competitive market due to its ability to enforce regulations, grants, and licenses that might render the market concentrated.¹²³

As a matter of fact, in 2008 and according to the neoliberal policy, Iran’s parliament passed the LIGPPC not only to transfer most SOEs to the private sector, but also to preserve a competitive market by preventing conditions that may cause market power. Although the government had gradually commenced privatisation in 1989, it was accelerated after enforcing the law in the sense that 87 per cent of total shares until 2016 were transferred between 2006 and 2013.¹²⁴ This transfer scheme contributed to pseudo privatisation, strengthening market power in various sectors of the economy. Among them, there were military institutions, religious and cultural foundations, welfare and pension funds, and revolutionary foundations that, to a large extent, owned SOEs.¹²⁵

2 Well-connected firms: the only possible option

The World Bank maintains that two essential factors may impact the success of privatisation: a competitive market, and the macroeconomic conditions of the country. Although these factors generate more economic benefits, it is still worth privatising in a non-competitive market provided that there is a programme for liberalising the currency market, trade, and pricing reforms.¹²⁶ It seems that the leading causes that compelled Iran’s government to implement privatisation were ‘ … the high costs and poor performance of SOEs … and the modest and unenduring nature of reforms that do not involve a change in ownership … ’.¹²⁷ It was hoped that private owners would enhance the efficiency and productivity.¹²⁸

Bourguignon and Sepúlveda reiterate that ‘ … when we consider privatisation in a competitive environment, the change is almost certainly positive.’¹²⁹ Davidson also contends that private ownership can secure benefits far better than public ownership; therefore, it is customary to see a strong argument for privatisation and against government ownership.¹³⁰ Notwithstanding this, Iran’s experiences show that efficiency of privatised companies does not increase. Nor do these companies enhance profitability or productivity.¹³¹ Apart from this, officials’ rhetoric about privatisation indicates that their primary concern is neither the private sector nor property rights, but a pseudo-relationship between the market and power. For example, in 2022, president Raisi emphasised that privatisation per se is not the government’s vision but a path toward directing, supporting, monitoring, and empowering the private sector.¹³² Hence, one would hardly have imagined that decentralisation through the market would be undertaken in Iran.¹³³

This demonstrates that Iran’s government is keen on playing a crucial role in the market directly or through market power. The deputy of the Iranian Chamber of Commerce emphasises that privatisation has failed because those institutions controlling the economy have conducted ambitious plans for themselves and they are unlikely to share the economic benefits with others.¹³⁴ In this regard, Rome’s study shows that ‘the government’s assets have been primarily sold to large conglomerates associated with religious and revolutionary foundations, the Islamic Revolutionary Guard Corps (IRGC), pension funds, and other entities other than the real private sector’.¹³⁵ Among the 300 top listed companies, SOEs or quasi-governmental organisations are leading the economy.¹³⁶ At the same time, the private sector has the controlling shares of companies whose activities are in real estate, automotive, rubber and plastic, and banking and securities industries.¹³⁷

Apart from this, the private sector’s share in Iran’s economy has fallen 50 per cent in the last two decades.¹³⁸ The government’s privatisation policy in Iran proves that although it pretends to liberalise the economy, the central core of the market has to be quasi-governmental organisations and well-connected firms. In this respect, five sectors are analysed based on the correlation between market power, government intervention, and Iran’s governmentalisation.

2.1 Market power in cyberspace

The government aims to enact a protection law restricting internet freedom and controlling users’ data in Iran. Accordingly, there would be a government-owned centre to receive all the data from tech companies in Iran.¹³⁹ Currently, the government is optimistic about obtaining the necessary infrastructure to build its National Internet Network separated from World Wide Web.¹⁴⁰ In this regard, an agreement with China was concluded that enables Chinese companies to build the infrastructure for a 5G telecommunications network and contribute to Iranian authorities’ dominance over cyberspace.¹⁴¹ The Ministry of ICT’s 2017 proposal was another endeavour to make dominant power in the market by supporting local messaging services. The proposal entailed an incentive plan in which any local platform that took one million users, $260000 financial assistance would receive in exchange.¹⁴²

2.2 Market power in telecommunication industry

In 2009, an auction was supposed to be conducted by three bidders to divest Iran’s Telecommunication Company (TCI). One of the bidders was eliminated a day before due to the lack of security clearance.¹⁴³ Two bidders, Tose’ Etemad Mobin and Basij Cooperative Foundation, participated in the auction. Finally, 51 per cent of shares were sold to Tose’ Etemad Mobin, which had links to IRGC Cooperative Foundation (a quasi-governmental organisation).¹⁴⁴ At first, although the Competition Council wondered whether the deal complied with the law, the Council held that TCI was a natural monopoly and the deal resulted in the transfer of monopoly from the government to a quasi-governmental organisation; therefore, the Council deemed that no anti-competitive act was committed. In addition, the head of the Council highlighted that annulling the deal would be costly, and decided not to take any action for wealth maximisation.¹⁴⁵ This indicates that the government determines the truth and justifies market power using a consequentialist approach.

2.3 Market power in audio-visual media services

For decades, the Islamic Republic of Iran Broadcasting (IRIB) has had exclusive control of broadcasting networks under government funds.¹⁴⁶ Its responsibility is to exercise government power and canalise freedom of expression. For instance, per the appointment of the new head of IRIB, the supreme leader highlights IRIB’s priorities which are ‘ … cultural guidance, strengthening the spirit and sense of national and revolutionary identity, promoting the Iran-Islamic way of life, and increasing national solidarity … .’¹⁴⁷ According to article 2, investment, ownership and management of radio and television activities are under the government's exclusive rights. In addition, principle 175 of the constitution maintains that the supreme leader appoints the head of IRIB, and this organisation observes Islamic criteria and the welfare of the country. Still, privatisation is unlikely to weaken the IRIB’s monopoly in the sense that IRIB expanded its supervision to video-on-demand and video-sharing platforms. In 2017, SATRA, a regulatory body of the IRIB, was established¹⁴⁸ with a significant authority to supervise and permit those platforms.¹⁴⁹ In doing one of its supervisory responsibilities, SATRA clarified that VODs must obtain the license and abide by any enforced directives or instructions issued by SATRA.

In this case, the Audiovisual Media Service Directive (AVMSD) was published. Article 3 of AVMSD divides the requirements into general and particular, saying that SATRA is authorised to arbitrarily request a platform to meet the particular requirements in addition to the general ones.¹⁵⁰ Besides, in parallel with ratifying the Annual Budget Bill for Fiscal Year 2022, the parliament outlined that the IRIB has exclusive authority over issuing permission and regulation for VODs. This demonstrates that the government backs IRIB as a market power and, regardless of its monopolistic nature, is authorised to supervise the market and change the level playing field in the case of losing market share. Hence, as an institution of the government, this market power can direct social life by restraining potential competitors, restricting individuals’ choices, and making them governable.

2.4 Market power in the pharmaceutical industry

This industry is closely associated with the healthcare system of a country. The healthcare system is a prominent instrument for the government to control and shape individuals’ bodies. In fact, health conditions in society reflect the standard of living, which concerns biopolitics.¹⁵¹

The pharmaceutical industry is extremely regulated by Iran’s government. In this respect, all prices are determined by Iran Food and Drug Administration (IFDA).¹⁵² This per se can hinder the market and increase tendencies to create market power. Besides, the government is interested in engineering the priorities. For instance, the supreme leader announced General Policies on Healthcare in 2014. According to article 5, ‘ … policymaking and supervising the production, consumption, and importation of medicines, vaccines, bio-products, and medical equipment by aiming to protect local production and promote exportation’¹⁵³ are expected from the industry. Such a direction demonstrates that imposing preferred disciplines of bodies is combined with a controlled market in which oligopolistic or monopolistic behaviours might be strengthened.¹⁵⁴

In this case, SHASTA,¹⁵⁵ whose main shareholder is Social Security Organisation (SSO) is a considerable example. The company manages the largest pharmaceutical holding in Iran (TIPICO). Four distributing companies are owned by TIPICO, accounting for 35% of Iran’s medicine distribution market, and TIPICO’s share of the medicine market is approximately 20%.¹⁵⁶ By having 20 subsidiaries, Barkat Pharmaceutical Group is another largest company in the pharmaceutical industry.¹⁵⁷ This group accounts for 14% of the Iranian market medicine.¹⁵⁸ Barkat is indirectly owned by Execution of Imam Khomeini’s Order (EIKO) which is under the supreme leader's direct supervision.¹⁵⁹

In the oligopolistic market, firms’ business decisions can impact on other competitors’ behaviours and strengthen coordination.¹⁶⁰ For instance, in 2022, Barkat and TIPICO signed an MoU to protect medicine exports. For this, both companies agree on sharing their infrastructure, joint study and assessment of targeted markets, taking advantage of private and governmental connections, and collaborative advocacy for facilitating and eliminating exportation barriers.¹⁶¹ Here, both companies officially entered into an agreement, enhancing their access to and control over the market with coordination and collusion.

As Foucault posits, the exercise of power can facilitate or make something complicated and restrain or prohibit it in an ultimate manner.¹⁶² In addition, there is no constraint to hinder institutions other than the government from exercising power or being part of the power relations.¹⁶³ Regarding Iran’s pharmaceutical industry, it seems that the biopolitical form of power and market power converge to infiltrate the medicine market and implement disciplines.

2.5 Market power through import bans

Automotive industry is another salient sector in which Iran’s government expands and dictates power. Two central players, IKCO and SAIPA, dominate the Iranian vehicle market,¹⁶⁴ restrict customers’ choices, and manipulate their preferences. IKCO’s and SAIPA’s market shares account for approximately 90%.¹⁶⁵

At first sight, it seems that Iranian customers have the option not to purchase locally manufactured cars, but the market is not open enough to provide one with benign options. The central players can construct the favoured market structure through their power.¹⁶⁶ For instance, IKCO and SAIPA benefit from non-tariffs and tariffs limitations backed by the government’s protectionist approach. After the United States sanctions reimposition in 2018,¹⁶⁷ Iran’s government restrained car imports to control currency crisis purportedly. However, the main idea was to strengthen protectionism.¹⁶⁸

Further, when in 2022 the new government decided to dispense with the car imports ban, this decision did not change the status quo of power relations. Article 3 of the Regulation for Importing Cars maintains that the value of the imported car should not exceed 20,000 euros and vehicles with up to 10,000 euros value are in priority of import.¹⁶⁹ Article 6 also determines 1 billion euros as the annual ceiling for car imports, meaning that a maximum of 100,000 cars might be imported.¹⁷⁰

Although IKCO and SAIPA were part of the privatisation scheme, the government still has direct ownership of 5% and 17%, respectively.¹⁷¹ However, another study indicates that the genuine share of the government is a far cry different if one considers indirect shares. In this regard, the government’s affiliates, such as pension funds and some banks in which the government has ownership, possess IKCO’s shares; therefore, the government’s share is equivalent to approximately 51% of IKCO.¹⁷² Besides, IKCO and SAIPA engineer shareholders’ structure by allowing their subsidiaries to acquire at least 25% of IKCO’s and 40% of SAIPA’s shares.¹⁷³

It can be seen here how market power guides the possible conduct of customers in the market and influences the government to strengthen protective measures. In the Foucauldian approach, power is the capacity to alter others’ actions. In this respect, if one (mis)used power to decrease another’s freedom, the relation would be dominant.¹⁷⁴ This is the nature of relations in Iran’s automobile market.

Finally, one can point out that privatisation enables well-connected firms to occupy the market, become market power, and shape individuals’ conduct. If rationalisation of the market was another name for an interventionist government or market power, it might be said that Iran’s government rationalised the market. However, in reality, the government notoriously used its power to dictate that quasi-governmental organisations were the only possible and fair option. Thus, it can be seen that the government sought and continues to seek to engineer a disciplinary society with revolutionary and Islamic beliefs.¹⁷⁵ Iran’s governmentalisation of the market was a pragmatic decision to render the market manageable and avoid the welfare state’s failure. Hence, it is highly unlikely that governmentalised power in neoliberal terms will appear as long as the government persists in occupying the market. In this case, the success or failure of a plan no longer guarantees its continuity or dismissal. For instance, if success eliminates prerequisites of a plan, this will deprive the programme of a justification to continue. By contrast, the failure might be called a success because its causality in creating new problems enables the government to strategically reinvest.¹⁷⁶ In this vein, Iran’s government defined a manipulated privatisation project whose success was not in freeing individuals, but in highlighting repercussions of the project to justify further steps of market occupation. That is why in terms of governmentality, this is a failed project, while it is a success from the perspective of government apparatus.

V Conclusion

Prior to neoliberalism, the laissez-faire principle established a self-regulated system of individuals’ decisions with the least government intervention. In this sense, the police state whose rationality was based on raison d’etat realised that its authority could not sufficiently influence the population; therefore, there was no solution other than free exchange to secure individuals’ interests and the state. This was a new rationale that determined truth and, at the same time, demonstrated whether a state’s act secured interests or not. However, this approach was attenuated by introducing competition as the core subject of the market. An act of government, in this regard, is neither based on sovereignty nor discipline. The government interferes in the market to secure it. Otherwise, the market is fragile because it can be distorted by market power. Governmentality in developing countries like Iran is an imported rationale whose goal is good governance. According to good governance, the government should implement some fundamental reformations to change extrinsic conditions of the market. Among those reforms, privatisation is intended to make people responsible, reduce the role of the government, enhance efficiency in SOEs, and promote competition. In neoliberal order, markets are the realm of governmentality.

Iran commenced a neoliberal project by privatising SOEs and introducing competition as the building block of the market. The government, however, oversimplified the implementation of neoliberal policy, which resulted in capital centralisation in the hands of well-connected firms. In this case, the act of government was to indoctrinate that there was no alternative other than for these firms to take the ownership of assets, and the market would be rendered accessible by competition law. Such a system fosters viable market power, which is associated with a deliberate misconception of free exchange and the notion of competition. This experience indicates that Iran’s government is disinclined to let the market free or increase individuals’ options. Instead, the government is keen on establishing market power with well-connected firms to control the market. In other words, neoliberalism was a failed project in Iran that neither led to decentralised power nor institutionalised laissez-faire but rather progressively centralised the power. The solution is not to reverse the neoliberal policy, nor should LIGPPC be repealed. However, a radical change in power relations is required to reject the current governmentalisation, respect individuals’ choices, and embrace the free market.

In retrospect, the government should not have deployed a pseudo neoliberal order. Nor does any reversal result in less government interferences. Under a neoliberal governmentality, a distant government is achievable and should be promoted. However, Iran’s economy is surrounded by market powers which define common interests with the government in controlling the market. Although individuals are free to choose in the market, their options are managed by well-connected firms. If the government is assertive in creating economic prosperity, this approach should be alienated. In this case, a free market can eat the well-connected firms¹⁷⁷ and eliminate these manipulated power relations in which individuals are subject to the whim of an authoritarian regime.

Acknowledgement

The Author would like to thank Professor Jonathan Crowe for multiple insights and Shirley Brown for copyediting.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Notes on contributors

Matin Pedram

Matin Pedram is a PhD student at Bond University. His focus is law and economics in developing countries. In this sense, he intends to explore the Austrian school of economics to find reliable solutions for a legal system in promoting and protecting individuals’ rights. Accordingly, he published articles on Competition Law, Environmental Law, and Property rights.

Notes

1 Brian CJ Singer & Lorna Weir, ‘Politics and Sovereign Power Considerations on Foucault’ (2006) 9 (4) European Journal of Social Theory 443, 454. In Foucault’s literature, it is a prima facie fact that sovereignty was not replaced by disciplinary power. Nor was disciplinary power succeeded by the government. See Thomas Lemke, Foucault, Governmentality, and Critique (Routledge, 2012) 90.

2 Michel Foucault, The Birth of Biopolitics, tr Graham Burchell (Palgrave Macmillan, 2008) 6–8.

3 Wanda Vrasti, ‘Universal but not Truly Global: Governmentality, Economic Liberalism, and the International’ (2013) 39 (1) Review of International Studies 49, 51–2. Increasing population was encouraged to strengthen and enable states to be competitive among other states. See Foucault (n 2) 5.

4 Vrasti (n 3) 51–2.

5 Lemke (n 1) 45.

6 David F Gruber, ‘Foucault's Critique of the Liberal Individual’ (1989) 86 (11) The Journal of Philosophy 615, 616.

7 Foucault (n 2) 117–8.

8 Vrasti (n 3) 60.

9 Foucault (n 2) 120.

10 Graham Burchell, ‘Liberal Government and Techniques of the Self’ (1993) 22 (3) Economy and Society 267, 271.

11 Vrasti (n 3) 52.

12 Michel Foucault, Security, Territory, Population, tr Graham Burchell (MacMillan, 2009) 102.

13 A despotic monarchy was replaced with a parliamentary monarchy during the Constitutional Revolution. See Ervand Abrahamian, ‘The Causes of the Constitutional Revolution in Iran’ (1979) 10 (3) International Journal of Middle East Studies 381, 386. However, this democratisation was distorted by various problems such as foreign interventions (Anglo-Russian rivalry), famine, political divisions, and so forth which resulted in an absolute statism temptation. See Michael P Zirinsky, ‘The Rise of Reza Khan’ in John Foran (ed), A Century of Revolution Social Movements in Iran (University of Minnesota, 1994) vol 2, 46–8. At this point, Reza Khan conducted a bloodless coup in 1921 to preserve law and order and restructure the bureaucracy. See Reza Sheikh and Farid Fadaizadeh, ‘The Man who Would be King: The Rise of Rezā Khān (1921–1925)’, (2013) 37 (1) History of Photography 99, 100.

14 See Vanessa Martin, ‘Mudarris, Republicanism and the Rise to Power of Riza Khan, Sardar-i Sipah’, in Stephanie Cronin (ed), The Making of Modern Iran: State and Society under Riza Shah 1921–1941 (Taylor & Francis Group, 2003) 68.

15 Michel Foucault, ‘What Are the Iranians Dreaming About?’ tr Janet Afary and Kevin B Anderson (Web Page) <https://press.uchicago.edu/Misc/Chicago/007863.html>.

16 ‘Power is everywhere; not because it embraces everything, but because it comes from everywhere.’ Michel Foucault, The History of Sexuality, tr Robert Hurley (Pantheon, 1978) vol 1, 93.

17 Mark Philp, ‘Foucault on Power: A Problem in Radical Translation?’ (1983) 11 (1) Political Theory 29, 33–4.

18 Michel Foucault, Power/Knowledge; Selected Interviews and Other Writings 1972–1977, tr Colin Gordon et al (Pantheon Books, 1980) 105.

19 Lemke (n 1) 90.

20 Ludwig von Mises, Liberalism in The Classical Tradition, (Cobden Press, 3rd ed, 2002) 19.

21 Marianne Constable, ‘Foucault & Walzer: Sovereignty, Strategy & the State’ (1991) 21 (2) Polity 269, 279.

22 Xiao Han, ‘Disciplinary Power Matters: Rethinking Governmentality and Policy Enactment Studies in China’ (2021) Journal of Education Policy 1, 3–4.

23 Mitchell M Dean, Governmentality: Power and Rule in Modern Society, (Sage Publications, 2009) 173.

24 Miri Rozmarin, ‘Power, Freedom, and Individuality: Foucault and Sexual Difference’ (2005) 28 (1) Human Studies 1, 3.

25 Saul Newman, ‘Power, Freedom and Obedience in Foucault and La Boétie: Voluntary Servitude as the Problem of Government’ (2022) 39 (1) Theory, Culture & Society 123, 127.

26 Paul A Bové, ‘Power and Freedom: Opposition and the Humanities’ 53 (1990) The Humanities as Social Technology 78, 84.

27 Ibid 84.

28 Ibid.

29 Newman (n 25) 126.

30 Ibid 125.

31 Bové (n 26) 84.

32 Vrasti (n 3) 52.

33 Foucault (n 16) 136.

34 Roger Deacon, ‘An Analytics of Power Relations: Foucault on the History of Discipline’ (15) 1 (2002) History of the Human Sciences 89,101.

35 Paolo Savoia, ‘Foucault’s Critique of Political Reason: Individualization and Totalization’ (2012) 43 Revista de Estudios Sociales 14, 17–8.

36 Michel Foucault, Discipline and Punish; The Birth of the Prison, tr Alan Sheridan (Pantheon, 1978) 170.

37 Ibid.

38 Ibid 137–8.

39 Foucault (n 16) 136.

40 Ibid 140.

41 Lemke (n 1) 42.

42 Foucault (n 16) 139.

43 Mona Lilja and Stellan Vinthagen, ‘Sovereign Power, Disciplinary Power and Biopower: Resisting What Power with What Resistance?’ (2014) 7 (1) Journal of Political Power 107, 122.

44 Ibid 119.

45 Jonathan Joseph, ‘Governmentality of What? Populations, States and International Organisations’ (2009) 23 (4) Global Societies 413, 415.

46 Barry Hindess, Discourses of Power: from Hobbes to Foucault (Blackwell Publishers, 1996) 106.

47 Nikolas Rose & Peter Miller, ‘Political Power beyond the State: Problematics of Government’ (1992) 43 (2) The British Journal of Sociology 173, 175

48 Payman Shamsian, ‘Islamic Governmentality within Shia Ideology: How does Governmentality Work in Iran-Hezbollah Relationship?’ (Master Thesis, Central European University, 2015) 9.

49 John Protevi, ‘What does Foucault Think IS New about Neoliberalism?’ (Web Page, 28 June 2009) <http://www.protevi.com/john/Foucault_28June2009.pdf>.

50 Lemke (n 1) 42–3.

51 Ibid 46.

52 Foucault (n 16) 135–6.

53 Lemke (n 1) 99.

54 Carl Death, ‘Governmentality at the limits of the international: African Politics and Foucauldian Theory’ (2013) 39 (3) Review of International Studies 763, 770.

55 Ibid 768.

56 Dean (n 23) 155.

57 Ibid 173.

58 Michelle Brady, ‘Ethnographies of Neoliberal Governmentalities: from the Neoliberal Apparatus to Neoliberalism and Governmental Assemblages’ (2014) 18 Foucault Studies 11, 24–5.

59 Ibid 26.

60 Aref Barkhordari, ‘A Shorty History of Liberalism in Contemporary Iran’ (2022) 33 Constitutional Political Economy 200, 202.

61 Foucault (n 2) 30–2.

62 The origin of laissez-faire is not certain. But the conventional narrative, in this case, is the one that scholars refer. For example, Burgin mentions that ‘ … although slight variations of this formula subsequently appeared in the writings of Pierre de Boisguilbert, it did not become more widely adopted until the mid-eighteenth century.’ See Angus Burgin, ‘Laissez-Faire’ in Michael T Gibbons (ed), The Encyclopedia of Political Thought (John Wiley & Sons, 2015) 1. Similarly, see Emma Rothschild, ‘Social Security and Laissez Faire in Eighteenth-Century Political Economy’ (1995) 21 (4) Population and Development Review 711, 719.

63 Burchell (n 10) 269.

64 Foucault (n 16) 136.

65 Foucault (n 2) 10–11.

66 Lemke (n 1) 42–3.

67 Michael A Peters, ‘Foucault, Biopolitics and the Birth of Neoliberalism’ (2007) 48 (2) Critical Studies in Education 165, 169.

68 Lemke (n 1) 16.

69 Friedrich von Hayek, Law, Legislation, and Liberty (Routledge, 1998) vol 3, 163.

70 Foucault (n 2) 282–3.

71 Ibid 32.

72 Foucault (n 2) 118.

73 Danielle Guizzo and Iara Vigo de Lima, ‘Foucault’s Contributions for Understanding Power Relations in British Classical Political Economy’ (2015) 16 EconomiA 194, 202.

74 Foucault (n 2) 118.

75 Ibid 118.

76 Certain conditions in a perfectly competitive market ‘are a finite number of agents (consumers and firms) and a finite list of goods. Each good is associated with a single price expressed in a numéraire. Each rational firm selects the inputs and outputs that maximize its net receipts, given it can buy and sell any quantities without manipulating prices.’ See Ludovic A Julien, ‘From Imperfect to Perfect Competition: A Parametric Approach through Conjectural Variations’ (2010) 78 (6) The Manchester School 660, 660.

77 Foucault (n 2) 118–20.

78 Ibid 120.

79 Geoffrey TF Brooke and Lydia Cheung, ‘Uncertainty and General Equilibrium: an Evaluation of Professor Knight’s Contributions to Economics’ (2021) 45 Cambridge Journal of Economics 901, 907.

80 Hindess (n 46) 128.

81 Nikolas Rose, Powers of Freedom Reframing Political Thought (Cambridge University Press, 1999) 52.

82 Luca Mavelli, ‘Governing the Resilience of Neoliberalism through Biopolitics’ (2017) 23(3) European Journal of International Relations 489, 491.

83 Foucault (n 2) 121.

84 Spontaneous order refers to a dynamic situation in a society where all the forces even follow their aims, collaboration among them and coordination of their activities become possible. (Friedrich von Hayek, Law, Legislation, and Liberty (Routledge, 1998) vol 1, 46) And ‘that the spontaneous collaboration of freemen often creates things greater than their individual minds can ever fully comprehend’. Friedrich von Hayek, Individualism and Economic Order (University of Chicago Press, 1948) 7.

85 Hayek (n 84) 47.

86 Foucault (n 2) 132.

87 Friedrich von Hayek, The Constitution of Liberty, ed Ronald Hamowy (University of Chicago Press, 2011) 119–20 & 340.

88 Barbora Jedlickova, ‘Beyond the Economic Approach: Why Pluralism Is Important in Competition Law’ (2018) 37 (1) University of Queensland Law Journal 41, 54.

89 Stavros S Makris, ‘Applying Normative Theories in EU Competition Law: Exploring Article 102 TFEU’ (2014) 3 UCL Journal of Law & Jurisprudence 30, 56.

90 Joseph (n 45) 417.

91 Mises (n 20) 17.

92 Michel Foucault, ‘The Subject and Power’ (1982) 8 (4) Critical Inquiry 777, 790.

93 Joseph (n 45) 416–9.

94 Ibid 420.

95 Kevan Harris, A Social Revolution: Politics and the Welfare State in Iran (University of California Press, 2017) 78.

96 Ibid 78.

97 Sohrab Behdad, ‘Winners and Losers of the Iranian Revolution: A Study in Income Distribution’ (1989) 21 (3) International Journal of Middle East Studies 327, 353.

98 Navid Pourmokhtari Yakhdani, ‘Iran’s Green Movement: A Foucauldian Account of Everyday Resistance, Political Contestation and Social Mobilization in the Post-Revolutionary Period’ (PhD Thesis, University of Alberta, 2018) 159–60.

99 Gregory Jaynes, ‘Khomeini Returns to the Holy City of Iran’ New York Times (Qum, 2 March 1979) A8. ‘I have strongly stressed to the government to provide water, electricity and some other facilities free of charge for the impoverished class of the people who had been subject to deprivation, and hopefully with the establishment of the Islamic government this deprivation will be eliminated.’ See Ruhollah Khomeini, Sahifeh-ye Imam (An Anthology of Imam Khomeini’s Speeches, Messages, Interviews, Decrees, Religious Permissions, and Letters) (The Institute for Compilation and Publication of Imam Khomeini’s Works, 2008) vol 6, 232.

100 Harris (n 95) 103–6.

101 Ruhollah Khomeini, Sahifeh-ye Imam (An Anthology of Imam Khomeini’s Speeches, Messages, Interviews, Decrees, Religious Permissions, and Letters) (The Institute for Compilation and Publication of Imam Khomeini’s Works, 2008) vol 19, 35.

102 Tania Murray Li, ‘Governmentality’ (2007) 49 (2) Anthropologica 275, 276.

103 Rose (n 81) 18.

104 Michael Thomson, Alexander Kentikelenis, and Thomas Stubbs, ‘Structural Adjustment Programmes Adversely Affect Vulnerable Populations: A Systematic-Narrative Review of Their Effect on Child and Maternal Health’ (2017) 38 (13) Public Health Review 1, 3. KR Hope and G Kayira, ‘Development Policies in Southern Africa: The Impact of Structural Adjustment Programmes’ (1997) 65 (2) The South African Journal of Economics 118, 118.

105 For instance, Section 5 of the plan assures that the government rules out gradually the pricing mechanism of all goods and services other than those products that the government recognises their direct pricing is required. Further, the government warrants an equal opportunity for market players to compete and its impartiality. However, exportation would remain under the control of the government and local producers are still required to import the necessary raw materials under the supervision of the government. Ghanon-e Barname-ye Aval-e Tosee-ye Eghtesadi, Ejtemai, Farhangi-ye Jomhouri-ye Eslami-ye Iran [First Five-Year Economic, Cultural, and Social Development Plan] 31 January 1990 (Iran) [tr author].

106 In this case, Hayek’s suspects about the legislature’s power to alter laws or enforce new restrictive laws are thoughtful. ‘the legislature may pass into law any sort of content so long as the proper procedures of the legislature have been obeyed’. See John CW Touchie, Hayek and Human Rights (Edward Elgar, 2005) 185.

107 Kevan Harris, ‘Iran's Commanding Heights: Privatization and Conglomerate Ownership in the Islamic Republic’ in Ishac Diwan (ed), Crony Capitalism in the Middle East: Business and Politics from Liberalization to the Arab Spring (Oxford University Press, 2019) 375.

108 ‘IMF and Good Governance’ IMF (Online, 24 June 2022) <https://www.imf.org/en/About/Factsheets/The-IMF-and-Good-Governance>.

109 Joseph (n 45) 421.

110 See Jedlickova (n 88) 42.

111 Foucault (n 2) 44.

112 Broadly speaking, the utilitarian approach is a kind of consequentialism in any social interaction. In this case, antitrust laws aim to evaluate conduct by considering its tangible consequence such as utility or wealth maximisation. Not all liberal or neoliberal thinkers rely on utilitarianism. Nor do they have a unified account of the competition and antitrust laws. For instance, Hayek criticises Bentham’s utilitarian approach. See Friedrich von Hayek, Law, Legislation, and Liberty (Routledge, 1998) vol 2, 17–23. By contrast, the deontological approach emphasises conduct per se to describe whether it is anti-competitive or not. For detailed information, see Jedlickova (n 88).

113 Ibid 62.

114 Protevi (n 49).

115 Law on Implementation of General Policies of Principle (44) of the Constitution (Iran) art 1 <https://www.nicc.gov.ir/asl-44-correction/2-uncategorised/1022-law-on-implementation-of-general-policies-of-principle-44-of-the-constitution.html>.

116 Section I of article 45 LIGPPC stipulates that: ‘Abusing dominant economic condition Abusing dominant economic conditions in one of the following ways:

1. Deciding, maintaining or changing price of a good or service in a non-conventional way;

2. Imposing unfair contract conditions;

3. Restricting supply or demand to raise or lower market price;

4. Creating impediments to make entry of new rivals difficult or eliminating rival firms or companies in a special profession;

5. Conditioning conclusion of contracts on acceptance of terms that have nothing to do with subject of such contracts in terms of nature or commercial norms;

6. Ownership of capital or shares of companies in a way that would harm competition.’ See Law on Implementation of General Policies of Principle (44) of the Constitution (Iran) <https://www.nicc.gov.ir/asl-44-correction/2-uncategorised/1022-law-on-implementation-of-general-policies-of-principle-44-of-the-constitution.html>.

117 Salvatore Zecchini, Glossary of Industrial Organisation Economics and Competition Law (OECD, 1990) 57. Further, the Supreme Court of the United States maintains that ‘Market power is the ability to raise prices above those that would be charged in a competitive market.’ See NCAA v. Board of Regents, 468 US 85 (1984).

118 Protevi (n 49).

119 Nick James, ‘Law and Power: Ten Lessons from Foucault’ (2018) 30 (1) Bond Law Review 31, 38.

120 Hindess (n 46) 141.

121 Murray N Rothbard, Power and Market: Government and the Economy (Ludwig von Mises Institute, 4th ed, 2006) 12.

122 Katharina Biely et al, ‘Market Power Extended: From Foucault to Meadows’ (2018) 10 (2843) Sustainability 1, 14.

123 Ibid 16.

124 Harris (n 107) 375.

125 Ibid 376. Harris in A Social Revolution: Politics and the Welfare State in Iran argues that engaging IRGC into businesses or privatisation is not an exclusive phenomenon in Iran. Nor can it be regarded as a militarisation of the economy. This process was a privilege to veterans who were conscripted or voluntarily participated in the Iran-Iraq war. See Harris (n 95)161. However, it should be noted that such a grant has led to market power and restrained the market in various levels. Such an argument also results in a hierarchical system in which the government prioritises people based on their zealousness and allocate resources.

126 Sunita Kikeri et al, Privatisation, the Lessons of Experience (Report 11104, the World Bank, August 1992) 4.

127 Ibid 21.

128 Ibid.

129 François Bourguignon and Claudia Sepúlveda, Privatisation in Development, Some Lessons from Experience (Working Paper 5131, the World Bank, November 2009) 17.

130 Sinclair Davidson, ‘Why Is Privatisation So Controversial?’ (2014) 30 (1) Policy 18, 21

131 Mohammad Alipour, ‘Has Privatisation of State-owned Enterprises in Iran Led to Improved Performance?’ (2013) 23 (4) International Journal of Commerce and Management 281, 300.

132 ‘Achieving a Common Understanding of Real Privatization in the Country's Economy Essential’ Government (Web Page, 22 May 2022) <https://irangov.ir/detail/387247>.

133 See also Kevan Harris, ‘The Rise of the Subcontractor State: Politics of Pseudo-Privatisation in the Islamic Republic of Iran’ (2013) 45 (1) International Journal of Middle East Studies 45, 50. In addition, the supreme leader ‘ … outlined the by-laws and aims of the principle 44 as freeing the administration from unnecessary economic activities, opening the path of venturing in national economy, promoting cooperatives sector … ’ See ‘Ayatollah Khamenei Instructs Authorities in Charge of Principle 44 Drive’ Leader (Web Page, 19 February 2007) <https://www.leader.ir/en/content/3597/Ayatollah-Khamenei-instructs-authorities-in-charge-of-Article-44-drive>.

134 ‘Tragedy of Privatization in Iran’ Eghtesadonline (Online, 25 August 2021) <https://www.en.eghtesadonline.com/Section-iran-economy-67/35579-tragedy-of-privatization-in-iran>.

135 Henry Rome, Iran's Revolution at 43: The Economy (Web Page, 9 February 2022) <https://iranprimer.usip.org/blog/2022/feb/09/irans-revolution-43-economy >.

136 The same is conducted in China. For instance, the sixth plenary session of the 19th Central Committee of the Communist Party of China stipulates that ‘ … the Party … has prompted state capital and SOEs to grow stronger, better, and larger, established a modern enterprise system with Chinese characteristics, and worked to make the public sector more competitive, innovative, risk-resilient, and capable of exerting a greater level of influence and control over the economy’. See ‘Resolution of the CPC Central Committee on the Major Achievements and Historical Experience of the Party over the Past Century’ State Council (Web Page, 16 November 2021) <https://english.www.gov.cn/policies/latestreleases/202111/16/content_WS6193a935c6d0df57f98e50b0.html>.

137 Harris (n 107) 380.

138 Fatemeh Kamani, ‘Iran’s Real Private Sector Share of Economy Has Reached Less Than 50 percent’ (Web Page, 19 January 2022) <https://www.isna.ir/news/1400102921641/> [tr author].

139 Miriam Berger, ‘Bill to Restrict Internet in Iran Could Threaten Pandemic-era Instagram Commerce Boom’ the Washington Post (online, 7 August 2021) <https://www.washingtonpost.com/world/2021/08/07/iran-instagram-pandemic-economy-ban/>.

140 Bobby Ghosh, ‘Iran Is Crushing What’s Left of Internet Freedom’ Bloomberg (Web Page, 3 January 2022) <https://www.bloomberg.com/opinion/articles/2022-01-03/iran-is-crushing-what-s-left-of-internet-freedom>

141 Farnaz Fassihi & Steven Lee Myers, ‘Defying U.S., China and Iran Near Trade and Military Partnership’ NYTimes (Web Page, 11 July 2020) <https://www.nytimes.com/2020/07/11/world/asia/china-iran-trade-military-deal.html>.

142 ‘Iran: National messenger apps are the new hallmark of Internet nationalisation’ Article19 (Web Page, 21 October 2018) <https://www.article19.org/resources/iran-national-messenger-apps-are-the-new-hallmark-of-internet-nationalisation/>.

143 Babak Dehghanpisheh, ‘This $7 Billion Deal Shows Who Really Runs Iran’ Reuters (Web Page, 24 December 2013) <https://www.businessinsider.com/this-7-billion-deal-explains-who-really-runs-iran-2013-12>.

144 Harris (n 133) 57.

145 ‘Council of Competition’s Final Decision about TCI’s 8 Billion Dollars Bid’ Hamshahri (Online, 13 March 2010) <hamshahrionline.ir/xT4D>. Tose’ Etemad Mobin currently has approximately 32 per cent of TCI’s shares. See <http://www.tsetmc.com/loader.aspx?ParTree=151311&i=22811176775480091#> [tr author].

146 Yakhdani (n 98) 128.

147 ‘Amongst the Priorities: Cultural Guidance, Promoting the Irano-Islamic Lifestyle’ (Online, 29 September 2021) <https://www.leader.ir/en/content/25281/The-Supreme-Leader-of-the-Revolution-appointed-Dr-Jebelli-as-the-new-IRIB-chief>.

148 SATRA, <https://en.satra.ir/about-us/>

149 ‘Audio Visual Media Innovation Centre is a new step taken by SATRA to create effective regulations in the virtual space. This centre relies on research studies, tries to make bilateral relationships with six knowledge-based companies, and turns the potential capacities of science centres in the audio-visual industry into action.’ See ‘Internet Has Important Effect in Human’s Lifestyle: IRIB Head’ Iran Press (Web Page, 27 June 2020) <https://iranpress.com/content/23461/internet-has-important-effect-human-lifestyle-irib-head>.

150 Establishment of a legal entity, SATRA’s approval on the article of association, Iranian person’s ownership of at least 70 per cent of the shares, capital, profit, and authority of appointing managers are the main special requirements (Article 13 of AVMSD). I do not intend to discuss the necessity of supervision in audiovisual media services. However, going through the Audiovisual Media Services Directive of the EU indicates that its primary responsibility is ‘ … to existing or future Union acts of harmonisation, in particular to satisfy mandatory requirements concerning the protection of consumers and the fairness of commercial transactions and competition.’ See Directive 2010/13/EU of the European Parliament and of the Council of 10 March 2010 on the Coordination of Certain Provisions Laid down by Law, Regulation or Administrative Action in Member States Concerning the Provision of Audiovisual Media Services [2010] OJ L 95.

151 Dean (n 23) 119.

152 Sara Emamgholipour and Lotfali Agheli, ‘Determining the Structure of Pharmaceutical Industry in Iran’ (2019) 13 (1) International Journal of Pharmaceutical and Healthcare Marketing 101, 112.

153 Siyasatha-ye Koli-ye Salamt [General Policies on Healthcare] (Iran) 7 April 2014, art 5 [tr author].

154 ‘[P]harmaceutical companies as suppliers are able to influence the physicians’ demand as patients’ agents through promotion, collusion, and demand-inducing strategies, and increase the pharmaceutical expenditure in the economy.’ Emamgholipour and Agheli (n 152) 112.

155 Social Security Investment Company, <shorturl.at/jpX34>.

156 ‘TIPICO Rahbar-e Bazar-e Daroui-e Keshvar’ [TIPICO Is the Medicine Market Leader] Sedaye Bourse (Online, 5 September 2022) <sedayebourse.ir/x5V6Q> [tr author].

157 Barkat Pharmaceutical Group, <https://en.bpharmed.com/>.

158 Tadbir Economic Development Group, <https://tedg.ir/content/barakatpharmed> [tr author].

159 Barkat Pharmaceutical Group, <https://en.bpharmed.com/>. Before the US sanctions in 2019, Tadbir Economic Development Group (TEDG) had most of Barkat’s shares. TEDG is an affiliate of Execution of Imam Khomeini’s Order (EIKO). According to EO 13876 (2019), the supreme leader of the Islamic Republic of Iran and his office have been sanctioned. Subsequently, any affiliates or subsidiaries whose ownership, interests, or control belongs directly or indirectly to the supreme leader will be sanctioned. In this respect, the United States sanctioned EIKO, one of the salient financial organisations under the supreme leader’s control. See Steve Stecklow et al, ‘Khamenei Controls Massive Financial Empire Build on Property Seizures’ Reuters (Online, 11 November 2013) <https://www.reuters.com/investigates/iran/#article/part>. TEDG was established in 2008 to expand EIKO’s investment projects in various areas like the pharmaceutical industry. See TEDG, <https://tedg.ir/en/content/introducingtadbir>.

160 Barbora Jedlickova, ‘Digital Polyopoly’ (2019) 42 (3) World Competition 309, 318.

161 ‘Tafahomname-ye Hamkari-ye Sherkat-e Daroi-e Barkat va Sarmayegozir-ye Daroi-e Tamin Emza Shod’ [MoU between Barkat Pharmaceutical Group and Tamin Pharmaceutical Investment Company] (Online, 18 October 2022) <https://bit.ly/3ZIRrg9>, archived at <https://perma.cc/S53L-L8ST> [tr author].

162 Foucault (n 92) 789.

163 ibid 784.

164 Kamran Barghandan et al, ‘Estimating Market Power and Strategies of Automobile Industry in Iran (Saipa and Iran Khoddro Companies Case Studies)’ (2017) 7 (2) International Journal of Economics and Financial Issues 701, 705.

165 Dominic Dudley, ‘Iran’s Government Tries Once again to Offload Shares in Local Automakers’ Forbes (Online, 29 April 2022) <https://www.forbes.com/sites/dominicdudley/2022/04/29/irans-government-tries-once-again-to-offload-shares-in-local-automakers/?sh=2b048f8f7508>.

166 Katharina Biely et al, ‘Market Power Extended: From Foucault to Meadows’ (2018) 10 (2843) Sustainability 1, 10.

167 See ‘Re-imposition of the Sanctions on Iran that Had Been Lifted or Waived under the JCPOA’ (Web Page, 11 April 2018) <https://home.treasury.gov/policy-issues/financial-sanctions/sanctions-programs-and-country-information/iran-sanctions/re-imposition-of-the-sanctions-on-iran-that-had-been-lifted-or-waived-under-the-jcpoa >.

168 Maziar Motamedi, ‘Why Iran Is Ending Its Years-Long Ban on Car Imports’ Aljazeera (Online, 22 August 2022) <https://www.aljazeera.com/news/2022/8/30/why-iran-is-ending-its-years-long-ban-on-car-imports>.

169 Tasvibname dar Khosos-e Varedat-e Khodro [Regulation for Importing Cars] (Iran) 25 August 2022, art 3 [tr author].

170 ibid art 6.

171 ‘Akharin Vaziyat-e Vagozari-ye Saham-e Khodrosazan’ [The Latest Status of Car Manufacturers’ Share Transfer] Donya-e Eqtesad (Online, 26 November 2022) <https://bit.ly/3kiJuxP> [tr author].

172 ‘Sahm-e Vaghei-e Dolat dar Khodrosaziha Cheghadr Ast?’ [How Much Is the Genuine Share of the Government in Automobile Manufacturers?] Tasnim (Online, 12 January 2022) <shorturl.at/jklq8> [tr author].

173 Arzeshgozari-ye Saham-e IKCO va SAIPA ta Yeki Do Hafte-ye Digar [IKCO’s and SAIPA’s Shares Might be Valued in the Next Two Weeks] Shargh Daily (Online, 19 July 2022) <https://www.sharghdaily.com/fa/tiny/news-851065> [tr author].

174 Kevin Jon Heller, ‘Power, Subjectification and Resistance in Foucault’ (1996) 25 (1) SubStance 79, 103–4.

175 Yakhdani (n 98) 111.

176 Lemke (n 1) 94.

177 This sentence is inspired by Jeremy Weiland’s article. See Jeremy Weiland, ‘Let the Free Market Eat the Rich’ in Gary Chartier and Charles W Johnson (eds), Markets Not Capitalism: Individualist Anarchism against Bosses, Inequality, Corporate Power, and Structural Poverty (Autonomedia, 2011) 301.