Chapter 6 considers the transformation of competition in the political sphere and the functions of the state. While prefigured in British politics of the seventeenth and eighteenth centuries, like the modern company the modern political party and party systems first emerged in the young US, largely in the same period. Despite early condemnation of parties and factions by political leaders (Washington, Adams, Jefferson), within a few decades the modern party system had taken shape, emerging out of more rough-and-tumble, quasi-militarised factionalism, before spreading to Europe as democracy supplanted aristocracy across the nineteenth century. The chapter also briefly examines the rise of adversarial law, and the replacement of patronage by competitive examinations for government appointment, as two further examples of the state’s institutionalisation of conflict through formalised competition.