English In rapidly developing policy fields such as that of the social economy, institutions play a central role in delimiting the range of the possible. This article suggests that social democratic policy analysts have given too much attention to the financial and operational autonomy of social economy organisations from the state, and have avoided specifying what sort of new state institutions might allow these organisations to reach their progressive ambitions. The experience of Québec, Canada, is used to illustrate how, in the absence of this institutional programme, existing centres of state power can deflect the social economy in a neoliberal direction.

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Despite the pressures of globalization, states remain relevant and maintain significant social policy capacities. Fulfilling these capacities has required innovation, with states increasingly acting on a local scale and seeking to leverage other actors’ resources to meet their ends. The study of the state–community interface in the construction of the social economy in QuÈbec highlights that the renewed state remains as much an object of social struggle as before. The question for communities in QuÈbec, as elsewhere, is whether they can organize to advance democracy, or whether they will be harnessed to underwrite national accumulation strategies.

Social policy innovation in Canada remains stunted despite recent attempts at social policy renewal via intergovernmental agreements. The fusion of accountability and policy learning is typically blamed, yet this ignores other potential factors. This article examines the Labour Market Agreements for Persons with Disabilities to highlight impediments to social program expansion and reform within governments as well as between governments, and how the design of recent agreements serves to reinforce those impediments. We find that the linkage of accountability and policy learning means that learning gets caught up in long-standing federal-provincial disputes over jurisdiction, and leads to a perverse form of learning. We also find significant barriers to innovation in the nature of federal government funding, which provides neither incentives for "have provinces" to expand their programming nor sufficient funds for "have not" provinces to successfully transform their programs.

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