Traditional theories of the “state” in public administration theory focus on the governmental apparatus. However, over the last 40 years several forces, such as the rise of neo-liberalism, the dismantling of communist regimes, and the global economic crisis of 2008 have forced a redefinition of the state and challenge contemporary public administration theory. This paper does two things. First, it describes and examines how the rise of neo-liberalism and the fall of communism have produced a crisis in public administration theory through a redefinition of the boundaries between traditional governmental and non-governmental activities. Second, the paper will examine what impact globalization and the economic crisis of 2008 has had on public administration theory and practice. The conclusion will be that contemporary public administration theory is in need of a new theory of the state to reflect the changing political economic order that emerged after the economic crisis of 2008.