This Element describes the fundamental principle of modernity that is the functional differentiation of society, how, under conditions of globalisation, market thinking came to hoist itself to the position of privileged site of societal rationality, what sustains law's own 'reflexive intelligence' under conditions of globalization.

1. The differentiation of the legal system; 2. Asymmetric developments: the spectre of de-differentiation; 3. The autonomy of law and the challenge of globalisation; 4. Conclusion; References.