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The End of Corporatism? Wage Setting in the Nordic and Germanic Countries
Abstract
The discovery of corporatism and its successes in the 1980s fueled a “growth indus try” for comparative political economy. By the early 1990s, its decline and even collapse shifted the terms of debate. Whereas initially interest was sparked by the need to investigate corporatist success, the new focus centered on the causes and consequences of corporatism’s seeming demise. The analysis of Swedish political economy is paradigmatic of this shift. In the 1970s, Sweden embodied the model corporatist country. Its highly centralized bar gaining between densely representative organizations of labor and capital was encouraged by government, which used social and economic policies to underpin and facilitate such arrangements. The outcomes were apparently beneficial for all concerned: the economy was efficient, as indicated by Swedish competitive success internationally, but also relatively equitable, as evidenced by the country’s record of redistribution.
... Germany is a good case to mine for insights and hypotheses inro these questions because here the deep ambivalence of employers toward traditional bargaining institutions has' been very much on public display. Germany has been invoked as a case in point both for those analysts wishing to draw attenrion to new strains and pressures in collective-bargaining institutions (Streeck 1995;Mahnkopf 1991), and by those who stress the resiliency of these arrangemenrs in spite of such pressures (Lange, Wallerstein, and Golden, 1995;Turner 1998). In emphasizing one dimension, however, each side has a tendency simply to downplay or ignore the other. ...
... The literature on German labor is replete with analyses of the centrifugal forces at work, before unification and certainly intensified after the Wall came down, though scholars differ on how to interpret these trends. Some "optimists" (for lack of a better term) have been impressed with the relative stability of formal bargaining institutions in the face of these substantial, indeed unprecedented, pressures (Turner 1998, Wallerstein, Golden, andLange, 1997;Lange et al., 1995), while other observers have emphasized more ominous trends (Mahnkopf 1991;Silvia 1996Silvia , 1997. Lowell Turner's analysis (1998) anchors the optimist position. ...
... Derudover er Tyskland udvalgt som repraesentant for et større ikke-nordisk land. Selv om Tyskland med sin føderale struktur adskiller sig fra de nordiske lande, så deler Tyskland og Danmark også en raekke karakteristika (Ganghof og Bräuninger, 2006: 527), herunder en lang tradition for en korporativ organisering af arbejdsmarkedet (Lange, Wallerstein og Golden, 1995;Toens, 2008;Ilsøe, 2017). Tyskland er desuden udvalgt som repraesentant for et europaeisk land, der siden 1951 har reguleret lobbyisme på forskellig vis -også selv om reguleringen betragtes som svag (Ronit og Schneider, 1998). ...
Svingdørslobbyisme vokser i Danmark, uden at det har medført ny lovgivning. I flere lande, som Danmark normalt sammenligner sig med, har en lignende udvikling fundet sted og ført til ny lovgivning. Lovgivningen begrundes af især to overordnede hensyn: hensynet til den generelle tillid til det politiske system og hensynet til beskyttelse af statens økonomiske interesser. Artiklen beskriver fremvæksten af svingdørslobbyisme i Norden og Tyskland. Herefter analyserer artiklen nyere lovgivning om regulering af svingdørslobbyisme i Norge, Sverige og Tyskland. Det konkluderes, at hensynet til såvel økonomi som tillid fremgår af den nyere lovgivning i alle tre lande, men også at reguleringen kun indeholder svage sanktioner i tilfælde af regelbrud. På denne baggrund diskuteres regulering af svingdørslobbyisme i Danmark.
... Derudover er Tyskland udvalgt som repraesentant for et større ikke-nordisk land. Selv om Tyskland med sin føderale struktur adskiller sig fra de nordiske lande, så deler Tyskland og Danmark også en raekke karakteristika (Ganghof og Bräuninger, 2006: 527), herunder en lang tradition for en korporativ organisering af arbejdsmarkedet (Lange, Wallerstein og Golden, 1995;Toens, 2008;Ilsøe, 2017). Tyskland er desuden udvalgt som repraesentant for et europaeisk land, der siden 1951 har reguleret lobbyisme på forskellig vis -også selv om reguleringen betragtes som svag (Ronit og Schneider, 1998). ...
Svingdørslobbyisme vokser i Danmark, uden at det har medført ny lovgivning. I flere lande, som Danmark normalt sammenligner sig med, har en lignende udvik-ling fundet sted og ført til ny lovgivning. Lovgivningen begrundes af isaer to over-ordnede hensyn: hensynet til den generelle tillid til det politiske system og hensy-net til beskyttelse af statens økonomiske interesser. Artiklen beskriver fremvaeksten af svingdørslobbyisme i Norden og Tyskland. Herefter analyserer artiklen nyere lovgivning om regulering af svingdørslobbyisme i Norge, Sverige og Tyskland. Det konkluderes, at hensynet til såvel økonomi som tillid fremgår af den nyere lovgiv-ning i alle tre lande, men også at reguleringen kun indeholder svage sanktioner i tilfaelde af regelbrud. På denne baggrund diskuteres regulering af svingdørslob-byisme i Danmark.
... Those pessimistic about the future of the German system of collective bargaining and worker representation argue that these challenges, when placed in the context of high unemployment and post-unification restructuring, may undermine the encompassing collective agreement system on which the German model is founded (Silvia, 1999). Others question this view (Lange et al., 1995;Turner, 1998), but it is clear that each of the challenges requires a response from trade unions if they are to maintain influence. Furthermore, in adopting the controversial action programme (Aktionsprogramm) that approved the adaptation of collective agreements to plant-level conditions, the Deutscher Gewerkschaftsbund (DGB -German Trade Union Confederation) tacitly acknowledged that tendencies towards decentralisation were unlikely to be reversed. ...
An ongoing series of mergers has resulted in almost continual change in the structure of British trade unions. By contrast, German trade union structure was a model of stability between 1950 and 1989, with 17 unions affiliated to the Deutsche Gewerkschaftsbund (DGB, German Trade Union Confederation) and the independent Deutsche Angestelltengewerkschaft (DAG, Union of Salaried Employees). Since 1989, however, the number of DGB affiliates has fallen to eight, and as a result of mergers DAG has become part of a DGB-affiliated union. Drawing on evidence from four case studies, this comparative analysis traces the development of the merger process in the two countries by reference to pre-merger debates and positioning, the procedures whereby mergers were brought about and merger outcomes.
... These early studies suggested that corporatist arrangements peaked during the 1970s and early 1980s and were fully implemented in the model states of Sweden and Austria. Subsequently, many authors (Cawson, 1985;Golden et al., 1995;Ferner and Hyman, 1998) have shown that corporatism is in decline. Proof of this trend has been given mainly from examining the model state of Sweden (Lash, 1985;Lindvall and Sebring, 2005). ...
Corporatism is an important concept in comparative research. However, crucial questions about trends of corporatism and its
impact cannot be tested because time-variant indexes are out of date or cover only a small sample of countries. In this study,
a corporatism index is developed and applied to 42 countries on an annual basis from 1960 to 2010. The application of this
index demonstrates that there is no decline of corporatism over the past five decades. However, the model states - above all
Sweden - reduced corporatist arrangements. In contrast, other countries, such as in the Benelux region, increased their degree
of corporatism and new corporatist states like Slovenia and South Africa emerged. The index developed in this article may
be a helpful tool for many scholars in the fields of political economy and macro-comparative politics. It makes a dynamic
analysis concerning the status of corporatism as dependent and independent variable possible.
... To legitimate their actions, governments preferred to adopt a policy of consensus rather than coercion. (Lange et al., 1995) dismiss as mere speculation that corporatism was weakened by the pressures of globalisation and deregulation. Their empirical study on six corporatist countries (Austria, Germany, Denmark, Finland, Sweden and Norway) indicates that concertation in these countries was still considered to be a more viable option to a less static system of industrial relations even though they admit that bargaining, especially in Sweden and Denmark, showed some tendency to become more decentralised (Lange et al,1995:96). ...
The structural changes induced by the EMU framework for a deepening of economic integration may interfere with the entrenched position often taken by the social partners. In countries like Malta, long used to government overspending and subsidy addiction, the conformity to fiscal rigour demanded by the Maastricht Treaty may be interpreted as a replacement of adjustment policy options to less attractive ones. The change generally triggers a call for a more transparent political process because it tends to bring in its wake a rise of participatory moods and ideologies which lead people to exercise the repertoire of existing demo-cratic rights more extensively. The dilemma which the social partners have to face is that of adapting their policies and strategies to the social and economic imperatives of this new socio-political scenario while at the same time retain the support of their hard core constituents who tend to hold to the traditional norms. Thus the leaders will have to find ways to inject a new type of rationality in their constituents and at the same time maintain the legitimacy of their leadership and of the organisation they represent. Social Partnership Social partnership is often equated with the modernisation of employ-ment relations which, is characterised by a desire of replacing legacies of hostile industrial relations with a new era of consensus (Stuart and Lucido, 2002:177). Indeed social partnership, or as is sometimes referred to as concertation, can be defined as an attempt to bridge the cultural and ideological differences between the actors involved in industrial rela-tions field. Partnership relations are contingent on the principle of mutual trust, which suggests that parties would only incur significant costs and risks on other parties if these, are prepared and in a position to accept sacrifices (ibid: 197).
... 10 Recent experience bears out this observation. Despite recent strains, bargaining over wages and working conditions remains relatively coordinated in all of the organized market economies (Iversen 1998;Regini 1995;Lange et al. 1995). Where there have been major changes, for the most part, these entail a shift downward in the level at which bargaining is conducted, as from the peak to the sectoral level in Sweden. ...
The movement for European integration has yielded a European Union of fifteen states with a unified monetary system that will eventually embrace over 370 million people. If current trends continue, an average of one in ten of these people will be unemployed. Not surprisingly, the European public ranks joblessness among its primary political concerns. This 2001 book focuses on both unemployment and economic unification. It examines the consequences of each and their interconnections. With chapters on the policy implications of European union, on current workings of domestic bargaining institutions and on how unemployment affects political behavior, this book yields a message with important policy implications: the organized managed economies of Europe should be reformed but not replaced, and a united Europe should be wary of modeling itself on the United States.
... Recent research suggests that this is a reasonable assumption. There has indeed been relatively little change in labor movement concentration in these 15 nations during the past several decades (Lange, Wallerstein, & Golden, 1995;Visser, 1990, chap. 7). ...
Three models have dominated recent research on the relationship between labor unions, wage behavior, and national economic performance: a simple linear model, a parabolic model, and a political model. This article argues that an unemployment-mediated linear model is theoretically preferable. In a context of low unemployment, encompassing labor movements can be expected to restrain wage demands, whereas localized unions have much less incentive to do so. In a context of high unemployment, localized unions should exhibit wage moderation, and the pressure on encompassing unions to restrain wage demands is further accentuated. These four models are assessed as predictors of wage changes, inflation, and misery index levels for 15 industrialized nations over the periods 1960-1973, 1974-1979, and 1980-1990. The linear models outperform the parabolic and political models in each of the latter two time periods. For the mid-to late 1970s the simple linear model performs best, but for the 1980s the unemployment-mediated linear model proves superior. None of the models has any explanatory utility for the pre-oil shock period.
... A second is further study of the empirical operations of specific types of economic cooperation, and of the degree to which they are utilized, in various nations. This area is particularly well suited for research by political economists (e.g., Katzenstein 1985; Lange et al. 1995; Coleman and Grant 1988) and sociologists of organization (Powell 1990; Lincoln and Kalleberg 1990). Understanding of economic cooperation would also bene-fit from formalized theoretical work, such as that by Knight (1992), on the functioning of particular forms of cooperation or of cooperative economic institutions in general. ...
Research on comparative political economic performance has traditionally followed two separate tracks, one concerned with collective economic gain (growth and efficiency) and the other focused on distribution and redistribution. Cooperative institutions offer a key to understanding cross-national variation among the affluent capitalist democracies in both facets of political economic performance. These institutions cluster along two dimensions: neocorporatism and firm-level cooperation. Pooled time-series analysis for 18 nations over 1960-89 suggests that (1) neocorporatism is a major source of distributive/redistributive policies and outcomes and of several sources of collective gain; (2) firm-level cooperation is a key contributor to economic growth.
... 2 With hindsight, the trajectory of Sweden (and, to a lesser extent, Denmark) turned out to be more the exception than the rule among Nordic and Central European countries. 3 Also, the years 1990s witnessed a veritable explosion of quintessentially corporatist policy making in other nations. Faced with the need to both control unit labor costs and reform the welfare state, virtually all European countries-the United Kingdom being the most notable exception-experimented with what currently goes under the name of "social pacts," that is, peak-level deals between governments, unions, and employer associations. ...
Based on field research at both the national and local levels, this article reconstructs the emergence of negotiated policy making in Italy in the 1990s. It argues that standard corporatist theory is totally incapable of accounting for the particular organizational mechanisms through which, at critical moments, that is, the moments in which policy change had to be introduced, consensus was mobilized among both middle-level union structures and rank-and-file workers in Italy. In fact, absent centralized organizational capacities, the Italian unions relied heavily on democratic decision-making procedures. These procedures strengthened the unions' capacity to hold to their side of the bargaining in national negotiations through essentially two types of mechanisms, aggregative and deliberative.
... The literature on comparative labor market institutions provides important pieces of the puzzle. First, scholarly work on centralized bargaining and the effects of international trade on small advanced capitalist states demonstrates that exposure of unionized workers to pressures from the international market promotes general wage restraint and labor peace in order to maintain national competitiveness in export markets (Garrett and Way, 1995;Iversen, 1996;Katzenstein, 1985;Lange et al., 1995;McKeown, 1999;Swenson, 1991Swenson, , 1989Wood, 1994). Second, it has also been convincingly demonstrated that the organizational capacity of workers is an important determinant of collective activities such as strikes and industrial action (Shorter and Tilly, 1974;Tilly, 1978;Snyder, 1975). ...
This study examines the role played by globalization in the decline of strike rates in industrialized countries after the 1980s. Using a pooled, time-series multiple regression analysis of 15 advanced capitalist countries in North America, Western Europe and East Asia from 1952 to 2001, the author finds a relationship between globalization – measured in terms of international trade, investment and loosened international capital controls – and declining strike rates, but finds that the relationship is non-monotonic and that the level and change of union density plays an intermediary role between globalization and labor quiescence. The findings empirically validate earlier work by Tsebelis and Lange and Shalev, who also demonstrated a non-monotonic relationship between macroeconomic phenomena, labor strength and strikes.
... First, they clearly imply that the overall number of economically important decisions in a corporatist setting (cw), compared to a more market oriented setting (m), is shifted from elected decision makers to non-elected decision makers (even though these decisions might be seen as (1978) and Lehmbruch and Schmitter (1982) have elaborated a set of measures of neocorporatism and have demonstrated that policy outcomes are correlated with variation in levels of neocorporatism. 28 There is a general consensus in the literature that levels of CWB have in fact declined over the past two decades although there is some debate as to how quickly and since when (Golden et al 1995;Franzese 2002). 8/25/2006 ...
... Third, institutional accounts are now among the most prominent explanations for national variation in unionization, in particular, across advanced capitalist democracies (e.g., Korpi, 1979;Lange, Wallerstein, & Golden, 1995;Wallerstein, Golden, & Lange, 1997). In a series of studies, Western (1993Western ( , 1994aWestern ( , 1994bWestern ( , 1995 develops an institutional model to explain trends in unionization across advanced capitalist democracies from the 1950s through the 1980s. ...
Purpose – East European ex-communist countries have now experienced nearly two decades of turbulent economic conditions and challenges resulting from the market transition. Since the early 1990s, there has been considerable decline in unionization throughout the region. This study uses information on union membership provided by four waves of the World Values Survey (WVS) to explain trends in unionization in East European ex-communist countries from 1990 to 2006.
Methodology/approach – We use random-effects and fixed-effects models to test predictions for three sets of explanations for cross-national and historical variation in unionization: industrialization, globalization, and institutions.
Findings – We find a degree of support for all three explanations of union decline. Overall, our analyses reveal the strongest support for industrialization and business cycle explanations. Inflation, unemployment, and urban population growth are all significant factors in shaping patterns of unionization in ex-communist East Europe. Our analyses show that aspects of economic and financial globalization have had significant, negative effects on unionization in the region. Manufacturing imports and foreign direct investment inflows appear to have undermined the position of domestic labor and contributed to declines in union membership.
Originality/value of the chapter – Successor and newly independent unions face the twin challenges of gaining public confidence as representatives of workers' interests, and withstanding increasing market pressures and conditions unfavorable for unionization. We provide evidence that without strong institutions to serve as buffers to external economic conditions, unionization levels in East European ex-communist countries are more open to market forces.
... Union centralization and concentration remained relatively stable in Sweden through the 1970s and 1980s, 44 for example, yet bargaining centralization in Sweden declined in the 1980s (see Figure 1). Union concentration has been perhaps the most commonly used indicator of organizational structure. ...
Wage setting has been one of the most heavily studied institutions in the field of comparative political economy over the past two decades, and quantitative measures of wage-setting arrangements have played a major role in this research. Yet the proliferation of such measures in recent years presents researchers with a sizable array from which to choose. In addition, some scholars are rather skeptical about the validity and/or reliability of these measures. This article offers a survey and assessment of fifteen wage-setting measures. It attempts to answer questions about (1) how these indicators differ from one another in conceptualization and measurement strategy; (2) which are the most valid and reliable; (3) the strengths and weaknesses of measures of wage centralization versus those of wage coordination; (40 particular countries or time periods for which there are noteworthy discrepancies in scoring; (5) how sensitive empirical findings are to the choice of wage-setting measure.
... The extent of bargaining decentralization is disputed by comparative researchers. Lange, Wallerstein, and Golden (1995; Golden etai, 1993) find significant continuity in collective bargaining through the 1970s and 1980s in a sample of 16 OECD countries. Still, other research finds that local bargaining has flourished alongside centralized wage talks (Katz, 1993; Baglioni and Crouch, 1990). ...
Wage growth slowed significantly in OECD countries in the 1980s and 1990s. Market explanations trace the wage slowdown to
a recession characterized by inflationary shocks, high unemployment, and slow productivity growth. Institutional accounts
focus on the effects of union density, collective bargaining centralization, and labour government. Analysis of time series
from 18 countries for 1966 to 1992 yields some evidence for both theories between 1966 and 1974. Bayesian methods indicate
a structural break in the wage growth process, linking the wage slowdown of the 1980s to the declining power of labour movements.
A re current employer practices qualitatively different from those of the recent past? This is the issue dividing Peter Cappelli and myself. Unlike Cappelli, I do not think that the institutions of the postwar U.S. labor market have undergone a structural transformation, certainly nothing so drastic as to warrant an obituary. Social scientists regularly contest the nature of institutional change, as in recent debates over the nation state, Nordic corporatism, collective bargaining, and superpower hegemony. Typically the debaters divide into two camps. On one side are the saltationists: those who see institutional change representing a break or rupture with the past. Here there is fascination with punctuated equilibrium models and other metaphors of discontinuous change. On the other side are the gradualists: those who see change occurring adaptively and being accommodated by existing institutions." Each side in these debates has its virtues and vices. The gradualists are sensitive to structural continuity and to path dependence, although this breeds a conservatism that causes them to miss historical turning points. The great neo-classical economist, Alfred H. Marshall, was a gradualist whose marginalism caused him to declare "Natura non facit saltum" (nature makes no leaps). The problem is, sometimes it does. Saltationists are alert to these transitions and quick to see fresh patterns. They also, however, have a tendency to give recent events more weight than a long-term perspective would warrant. There lies the nub of my differences with Cappelli. To understand my position, we need to go back to the late 1960s, when economists concerned with poverty developed a labor-market taxonomy known 168 CAUFORNIA MANAGEMENT REVIEW VOL 42, NO. I FALL 1999
Convergence among national economies is viewed by a growing number of observers as an inevitable result of increasing global integration of product and financial markets. Yet there is reason to doubt that globalization has yet brought about, or will in the future bring about, the degree of convergence assumed by some. First, markets require effectiveness, not optimality. This allows considerable space for continued differences in national economic policy choices, institutional structures, and performance patterns. Second, domestic institutions mediate the impact of international market forces. Institutions differ markedly across countries, generating substantial cross-national variation in the preferences and capacities of economic actors (firms, unions, policy makers, and so on). To assess the convergence thesis empirically, I examine developments in the 17 richest industrialized nations from 1960 to 1994. There is some indication of convergence in a few areas, but it is limited. This appears to owe partly to the fact that globalization itself remains limited and in part to the fact that globalization's convergence-generating effects are limited.
To 1989, developments on the national plane of this external dimension of change hinted at a partial disengagement between organized labour and the state. And yet, at best, these changes represented only portents of more fundamental changes to come. To elaborate we first look at the fate of the corporatist, and then the functional, relationships between organized labour and the state in the 1972–89 period. These were the relationships that had, for decades, kept trade unions within the orbit of the state. In the earlier survey of organized labour’s engagement with this external dimension (1945–72) it was ascertained that the national-political was by far the most important realm of interaction. This predictable finding emerged after a review of corporatist regimes — in both voluntaristic and statist forms — and also of the various ways in which the leaders of trade union organizations committed themselves to defending the interests of the state. Implicit throughout this was the assumption that the labour actors at furthest remove from the national-political realm — that is, the peak transnational confederations — acted as disengaged agents, rather than pivotal actors within the transnational network. In other words, the fixation on the national ensured that this transnational confederacy remained very weak indeed, in spite of its ever-increasing global reach.
Recent studies of macroeconomic management under varying organization of wage/price bargaining and varying degrees of credible monetary conservatism synthesize and extend theory and empirics on central bank independence (CBI) and coordinated wage/price bargaining (CWB). These studies find that the degrees of CBI and CWB interact with each other and with the broader political-economic context (international exposure, sectoral composition, etc.) to structure monetary-policymaker and wage/price-bargainer incentives. The theoretically surprising but empirically supported core implication was that even perfectly credible monetary conservatism has long-run, equilibrium, on-average real effects, even with fully rational expectations, effects that vary depending on the organizational structure of wage/price bargaining. Bargaining structure, conversely, has real effects that vary with the degree of credible conservatism reflected in monetary-policy rules, and, less surprisingly, CBI and CWB also have interactive nominal effects. Some disagreement remained over the precise nature of these interactive effects, but all theory and evidence agree that a single, credibly conservative European monetary policy would have nominal and real effects that depend upon the Europe-wide institutional-structural organization of wage/price bargaining relative to the prior domestic CBI-CWB combination. Indeed, the one specific point of theoretical and empirical agreement suggests that, for many Euro-member countries, monetary delegation to the single, credibly conservative, European Central Bank would generally worsen these bargainer-policymaker interactions. This review closes with a preliminary assessment of those predicted macroeconomic consequences one year after Euro notes and coins replaced twelve national currencies.1
In der formal-deduktiv vorgehenden „positiven“ Politischen Ökonomie bietet die Theorie relativ wenig Platz für eine aktive Rolle gesellschaftlicher Interessenverbände im politischen System. Ausgehend von der Frage, wie die politische Natur gesellschaftlicher Entscheidungen die Wahl bestimmter policies sowie deren wirtschaftliche Effekte beeinflusst, fokussieren sowohl die Politische Ökonomie als auch die public-choice-Literatur im engeren Sinn auf die formale Ausgestaltung des politischen Systems, wie sie insbesondere in der Verfassung niedergelegt ist. Zu Aspekten wie Wahlmodi, parlamentarisches Kammemsystem oder Föderalismus findet sich eine breite und inzwischen gut ausgebaute Literatur (siehe z.B. Drazen 2000; Mueller 1989; Persson/Tabellini 2000). Verbände werden hierbei als Lobby-Organisationen wahrgenommen, denen verschiedene Kanäle offen stehen, die im formalen politischen System getätigten Entscheidungen im Sinne ihrer partikularen Interessen zu beeinflussen. Zentrale Einflussmechanismen sind die Information politischer Entscheidungsträger sowie deren finanzielle Unterstützung (z.B. im Wahlkampf) als Gegenleistung für Entscheidungen, die die Interessen des Verbandes fördern (siehe z.B. Grossman/Helpman 2001; Potters/van Winden 1996). Aus der Perspektive des US-amerikanischen politischen Systems, das Vorlage für entscheidende Entwicklungsschritte der Politischen Ökonomie war, vermag diese eng an das pluralistische Politikverständnis gekoppelte Konzeption die Realität modellhaft adäquat abzubilden. Für die Funktionsweise europäischer politischer Systeme greift sowohl die Reduktion des Prozesses politischer Entscheidungsfindung auf den formalen Ablauf als auch die Konzeption von Verbänden als reine Lobby-Organisationen aber zu kurz.
In den letzten 25 Jahren haben die westeuropäischen Länder tief greifende ökonomische und soziale Anpassungsprozesse durchlebt. Sie mussten die Auswirkungen der Ölschocks in den siebziger Jahren verarbeiten, waren einem weitgehenden Prozess der ökonomischen Liberalisierung und Deregulierung durch die Effekte der europäischen Integration ausgesetzt, litten unter der zunehmenden finanziellen Belastung entwickelter Wohlfahrtsstaaten sowie sinkender Beschäftigtenquoten und mussten mit den Auswirkungen der ständig ansteigenden Internationalisierung von Märkten, insbesondere von Finanzmärkten, kämpfen.
The rate of unemployment differed dramatically between the EU and the EFTA countries in the 1970s and 1980s, but not in the 1990s. In this article, we present a model that can explain the persistence of both high and low levels of unemployment as a consequence of employers’ choice of employment policy. We contrast two employment policies: (1) a policy of cutting costs through layoffs when production is currently unprofitable and (2) a no-layoff policy that maintains a larger than necessary workforce during downturns in order to be assured of an adequate supply of labor during upturns. We show that either policy may be more profitable, provided enough other firms follow the same policy. We conclude with a discussion of the impact of economic integration on the sustainability of full employment in the EFTA countries.
There has been considerable debate as to whether powerful trade unions in European Union (EU) member states are compatible either with the internal market or with monetary union. As macroeconomic performance has deteriorated in many corporatist countries since the 1980s — Sweden providing the paradigmatic case — doubts about the compatibility of strong labor movements and EU membership have grown. Is corporatism a relic of a different age, a luxury of the long postwar boom? Are strong unions detrimental to and destabilizing for the internal market and monetary union in the EU? This article answers these questions in the negative. We contend, however, that existing arguments about the macroeconomic consequences of corporatism should be significantly modified to take into account the impact of the growth of public sector unions on the relationship between institutional structure of labor movements and economic outcomes. The deteriorating performance commonly attributed to corporatism in the 1980s was limited to countries where public sector unions increasingly dominated national labor movements. Encompassing trade union movements can still generate wage restraint, but only where the union movement is dominated by unions in the exposed sector that are subject to the constraints posed by international market competition. Hence, countries, such as Austria and Finland, with strong labor movements led by exposed sector unions are likely to enjoy the benefits of EU membership without suffering great costs, whereas the costs will be greater for countries with strong public sector unions such as Sweden and Norway.
L'approche en termes de « variétés de capitalisme » pose que pour coordonner leurs acti-vités, les entreprises peuvent soit compter principalement sur les marchés, soit s'appuyer sur des modes de coordination hors marché. Ces différences découlent du type et du niveau de soutien institutionnel dispo-nible pour la coordination de marché ou pour la coordination hors marché, dans chacune des économies politiques. Selon le mode de coordination des activités des entreprises dominant dans une économie politique, l'analyse distingue entre les économies de marché libérales et les économies de marché coordon-nées. Elle identifie les caractéristiques institutionnelles de chacune de ces économies politiques en matière de financement des entreprises (critères publics de profitabilité actuelle versus critères internes de fiabili-té sur le long terme), de structures internes des entreprises et de relation industrielle (hiérarchiques, individualisées et fondées sur la flexibilité versus négociées par des partenaires sociaux représentatifs et garantissant une protection de l'emploi), de formation et d'éducation (accent mis sur les qualifications générales versus qualifications spécifiques) et de relations interentreprises (concurrentielles et hostiles versus collaboratives et en réseau). Ces différentes institutions sont caractérisées par une complémenta-rité entre elles. L'analyse du fonctionnement de chaque économie politique permet de comprendre les processus de spécialisations internationales à partir des avantages comparatifs institutionnels de chacune. Elle permet aussi de comprendre les différences en matière de politiques économiques, sociales et interna-tionales, tout comme les différences en matière d'ajustement aux évolutions économiques mondiales.
Partisan tenure of government (in contrast to institutionalist and structural approaches) is used to explain the nature of governmental strategies to affect the supply side of the economy--the provision of the input factors, capital and labor. Supply-side economic strategies are a function of the party in office. Left-wing governments spend heavily in physical and human capital formation to raise the productivity of factors and the competitiveness of the economy. Right-wing governments rely instead on private agents to maximize economic growth. The organization of the domestic political economy and the international economy, which place heavy limits on the capacity of parties to affect the conduct of macro-economic policies, hardly constrain the choice of supply-side economic strategies. Regression analysis of data for levels of public spending on gross fixed capital formation and on education in OECD nations from 1960 to 1990. Supply-side policies conform to partisan preferences throughout the period examined. The institutional configuration of the economy affected policies jointly with government partisanship until the oil shock but not afterwards. Economic openness does not constrain the choice of supply-side policies.
This article discusses the relationship between the globalization of markets and national autonomy in the OECD. The paper makes two basic points. First, there are strong parallels between recent arguments about the constraining effects of globalization on national autonomy and those made in the 18th century about the domestic effects of market integration. We now know that past predictions of the effective demise of the nation-state were unfounded. Are there sign that things will be different in the contemporary epoch? The second point is that until the mid-1990s globalization has not prompted a policy race to the neoliberal bottom among the OECD countries, nor have governments that have persisted with interventionist policies invariably been hamstrung by damaging capital flight. The paper argues that, as it has been the case for more than 200 years, the coupling of openness with domestic compensation remains a robust and desirable solution to the problem of reaping the efficiency benefits of capitalism while mitigating its costs in terms of social dislocation and inequality.
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The paper examines variation in union density in advanced Western countries. It employs newly updated data on unionization which show that differences among industrialized Western nations persist overtime. The analysis includes examination of the role of corporatism, Left party power, Catholic party power, ethnic and linguistic diversity, the religious composition of the population, size of countries and labor force markets, proportion of the government and industry employment, government‟s share of GDP revenue. In addition to cross-national statistical analysis, union density rates are examined by major geographical and cultural clusters of countries, i.e., Northern countries, the Low Countries, English-speaking countries, German-speaking countries and Southern countries. We focus on divergence of union density between the United States and Canada, which belong to the same cluster of Western nations and have similar economic structures. We examine the role of social values and structural, economic, and political factors in divergence of unionism in Canada and the United States. Our analysis employs 1996 Lipset-Meltz survey data on attitudes towards unions in the United States and Canada as well as data from other surveys, such as the World Values Surveys.
Social dialogue, one of the main components of decent work, is the process of information and opinion exchange amongst employer, worker, and government representatives to consult, negotiate, and reach agreements on issues that concern them, which reflects the global diversity of the labour relations system. However, measuring social dialogue and the extent to which it exists in a country remains difficult, and therefore it is in need of its own set of statistical indicators that bring significant and useful data. This paper proposes that data collection and interpretation of social dialogue can be made by separating the subject into the following indicator categories: associational structure, wage setting arrangements, participation in public policy, and firm-level employee representation. The data collection method would entail detailed standardized questionnaires filled out by country experts and that indicators be as specific as possible. Eventually, data collection that maximizes objectivity, validity, and reliability through meticulous central guidance and monitoring, can be extremely useful for research and policy making of a country that aid in development overall.
This article explores the economic policies developed by the Spanish socialist government from 1982 to 1996, particularly with an eye on the impact the process of European integration had on them. The introduction of stable macroeconomic policies, in the form of high interest rates, is traced to the interaction of three factors. First, an increasingly internationalized economy, reinforced by the European single market and monetary union projects, forced the Spanish government to fight inflation and deprived it of the possibility of using currency depreciations. Secondly, a radical and fragmented union movement made it impossible for the González cabinet to rely on stable corporatist pacts to achieve wage moderation. Finally, intense pressure to build a welfare state and miscalculations about the direction of the economic cycle led to loose fiscal policies that had to be compensated with tight money measures. To compensate for its incapacity to establish a social democratic corporatist regime, the PSOE engaged in an active industrial policy geared to a restructuring of the publicly owned enterprises, expanded the Spanish public stock of human and physical capital, and increased social spending to compensate the unemployed and the losers of the transformation of the Spanish economy.
Based on quantitative indicators for fifteen advanced countries between 1974 and 2005, and case studies of France, the United Kingdom, Germany, Italy, Sweden, and Ireland, this article analyzes the trajectory of institutional change in the industrial relations systems of advanced capitalist societies, with a focus on Western Europe. In contrast to current comparative political economy scholarship, which emphasizes the resilience of national institutions to common challenges and trends, it argues that despite a surface resilience of distinct national sets, all countries have been transformed in a neoliberal direction. Neoliberal transformation manifests itself not just as institutional deregulation but also as institutional conversion, as the functions associated with existing institutional forms change in a convergent direction. A key example is the institution of centralized bargaining, once the linchpin of an alternative, redistributive and egalitarian, model of negotiated capitalism, which has been reshaped in the past twenty years to fit the common imperative of liberalization.
The public tax and transfer mechanisms of the welfare state are important sources of income stability for individuals and families. In comparisons of the stability of income in the United States and the states of the former West Germany, we found that household income tends to be more stable in Germany than in the United States. This disparity is partly due to greater turbulence in labor earnings in the United States and partly due to the more effective public social insurance system in Germany. These differences, however, are tempered by mechanisms that amount to a private, family-based insurance system in the United States, where, more so than in Germany, labor income from other family members and other, nonlabor sources of private income provide considerable stability.
This paper reviews recent work on macroeconomic management with varying wage/price-bargaining organizational structures and degrees of credible commitment to monetary conservatism. The emerging literature synthesizes and extends theory and empirics on central bank independence (CBI) and coordinated wage/price bargaining (CWB), arguing that the degrees of CBI and CWB interact, with each other and with other political-economic conditions (e.g., sectoral composition, international exposure, etc.), to structure the incentives facing actors involved in monetary policy and wage/price bargaining. The core implication, theoretically surprising but empirically supported, is that even perfectly credible monetary conservatism has long-run, equilibrium, on-average real effects, even with fully rational expectations, and that these effects depend on the organization of wage/price-bargaining. Conversely, wage/price bargaining structure has real effects that depend on the degree of credible conservatism reflected in monetary-policy rules. Each also has interactive nominal effects though this is less surprising. Although, much disagreement remains over the precise nature of these interactive effects, all emerging theory and evidence agree that a common, credibly conservative European monetary policy will have nominal and real effects that depend on the Europe-wide institutional-structural organization of wage/price bargaining. Indeed, the one piece of specific theoretical and empirical agreement suggests that, for many member countries, the nominal gains from monetary-policy delegation to a credibly conservative European Central Bank will have high real costs in terms of worsening these bargaining-policy interactions.
Key Words collective bargaining, industrial relations, wage setting s Abstract Between 1950 and 1980, labor markets grew increasingly organized in advanced industrial societies. Union membership in most countries expanded more rapidly than the labor force, centralized wage setting became more common, and union members became increasingly concentrated in a small number of large unions. Between 1980 and 1992, however, union density fell on average, and centralized wage setting grew increasingly rare. Only union concentration continued to increase in the 1980s. Existing theories of union organization and collective bargaining institutions are largely successful in explaining both the trends over time and much of the cross-national variation from 1950 to 1980, but they fail to account for the dramatic declines in union strength that some (but not all) countries have experienced since 1980.
In the last 15 years, two equilibria have arisen in the advanced world. On the one hand, wage dispersion has widened in those countries where unemployment has remained low (with cyclical variations). On the other hand, wherever income inequality has remained unchanged, unemployment has shot upwards. To account for these distinct patterns, we develop a political–economic model showing that, controlling for the skills of the population, the effects of technological and trade shocks (that have affected OECD nations) that are contingent on the institutional rules in place. Economies with generous unemployment allowances adjust through subsidized unemployment. By contrast, low levels of social protection lead to less unemployment but wider wage dispersion. The level of qualifications of the labor force determines the extent of the adjustment for a given institutional arrangement. We derive, in turn, the institutional structure of each country from the political conditions in place at the time of the shock. The empirical part successfully tests the model for the sample of European regions and US states.
The Social Democratic Full Employment Model in the Nordic Countries underwent a rapid transition in the 1980s and early 1990s. In this paper, change and continuity is examined along thre dimensions: the political stimulation of demand for labour, the political incentives influencing labour supply, and thirdly, the politics targeted towards enhancing the matching process on the labour market. In the first dimension it is shown that in all four countries the consensual wage bargaining systems were eroded in the 1980s which implied high wage increases and, as a consequence, shrinking employment. Despite the progress of globalisation, this institutional erosion was the main cause of the Nordic employment crisisin the early 1990s. In Denmark, Norway, and - not until the mid 1990s - Finland, the wage bargaining systems could be remodelled, but not so in Sweden. It is shown that this difference was caused by the reluctance of Swedish governments to release the employers fromthe financial burden of the welfare state. In the second dimension it is argued that the labour force supply declined in all four countries. The end of the Nordic 'Work Societies' can partly be explained by the strategic social policies of the various governments. In the third section, it is shown that the Social Democratic Model remained stable: In all four countries, active labour market policies are still at the centre of public attempts to improve the matching process on the labour market. Hence, continuity and change are mixed in the Nordic Full Employment Model. Taken together, this paper argues, that a restoration of the Social Democratic Full Employment Model in a world of globalised financial markets is based on a combination of moderate wage policies and a relieving of the employers of thecosts of the welfare state.
Using aggregate analysis, this paper examines the core contentions of the "varieties of capitalism" perspective on comparative capitalism. We construct a coordination index to assess whether the institutional features of liberal and coordinated market economies conform to the predictions of the theory. We test the contention that institutional complementarities occur across sub-spheres of the macroeconomy by examining the correspondence of institutions across sub-spheres and estimating the impact of complementarities in labor relations and corporate governance on rates of growth. To assess the stability of the institutional features central to the theory, we assess the dynamics of institutional change in recent years. The evidence suggests that there are powerful interaction effects among institutions across sub-spheres of the political economy that must be considered if the economic impact of institutional change in any one sphere is to be accurately assessed. Mit Hilfe von Aggregatdaten analysiert dieses Papier Kernaussagen des "Varieties-of-Capitalism"-Ansatzes. Um beurteilen zu können, ob die Aussagen der Theorie mit den institutionellen Begebenheiten liberaler und koordinierter Ökonomien übereinstimmen, konstruieren wir einen ländervergleichenden Index der ökonomischen Koordination. Wir überprüfen die These von der institutionellen Komplementarität zwischen den verschiedenen Sphären politischer Ökonomien, indem wir das Zusammenwirken von Institutionen analysieren und den Einfluss komplementärer Institutionen der Arbeitsbeziehungen und der Unternehmenskontrolle auf die Höhe von Wachstumsraten untersuchen. Wir diskutieren darüber hinaus, wie stabil die institutionellen Begebenheiten in den vergangenen Jahren waren. Im Ergebnis zeigen sich starke Interaktionseffekte zwischen den Sphären politischer Ökonomien, die berücksichtigt werden müssen, um die wirtschaftlichen Wirkungen institutionellen Wandels in einzelnen Sphären zu verstehen.
[Excerpt] This paper aims to develop usable indicators of the concept of social dialogue, as part of the ILO's effort to develop operational measures of Decent Work. Section 1 examines the concept of social dialogue. Section 2 looks at past approaches to measuring social dialogue. Section 3 discusses what we have learned from past approaches and the implications for developing indicators and collecting data. Section 4 describes and justifies the proposed indicators. Section 5 concludes the paper with a discussion of the implications of this methodology for practice, and an examination of the costs.
A close relationship with a Social Democratic party has traditionally been regarded as one of the best strategies
unions have to defend workers’ interests. This conclusion still seems valid today, since the changes
in the economic and social structure in the advanced capitalist societies alter the traditional content of their
relationship, not the reason for cooperation. However, this belief assumes among a unitary labor movement.
The experience of Southern Europe shows, on the contrary, that, when the union movement is divided
according to different partisan preferences, union leaders are forced to choose between their relationship
with their parties, or cooperating among themselves and being effective in the labor market. In addition, the
divorce between the Spanish Socialist party and the Socialist Union reveals that, no matter how strong
these organizations are, and despite their history of close ties, inter-union competition and a growing economy
make their relationship even more damaging for the union’s interests.
This paper reviews recent work on macroeconomic management with varying organization of wage/price bargaining and degrees of credible monetary conservatism. The emerging literature synthesizes and extends theory and empirics on central bank independence (CBI) and coordinated wage/price bargaining (CWB), arguing that the degrees of CBI and CWB interact with each other and with other political-economic conditions (sectoral composition, international exposure, etc.) to structure the incentives facing actors involved in monetary policy and wage/price bargaining. The core implication, theoretically surprising but empirically supported, is that even perfectly credible monetary conservatism has long-run, equilibrium, on-average real effects, even with fully rational expectations, and that these effects depend on the organization of wage/price bargaining. Conversely, wage/price-bargaining structure has real effects that depend on the degree of credible conservatism reflected in monetary-policy rules. Each also has interactive nominal effects though this is less surprising. Some disagreement remains over the precise nature of these interactive effects, but all emerging theory and evidence agree that a common, credibly conservative European monetary policy has nominal and real effects that depend on the Europe-wide institutional-structural organization of wage/price bargaining. Indeed, the one specific piece of theoretical and empirical agreement suggests that, for many member countries, the nominal gains from monetary-policy delegation to a credibly conservative European Central Bank will worsen these bargaining-policy interactions.
In the late 1980s, Norway's labor market experienced similar supply and demand shifts for skills to other countries but, unlike other OECD nations, Norway's wage setting system became more centralized. The pay distribution in Norway became more compressed at the bottom from 1987 to 1991, while low wage workers in other countries lost ground relatively. Using Norwegian microdata for 1987 and 1991, the author found that changing labor market prices helped cause this wage compression. Further, the less educated had declining relative overall employment but increasing relative public sector employment, both possible labor market responses to the wage compression.
this paper is to address these problems, by devising indicators for the central concepts of the varieties of capitalism approach and subjecting its core contentions to aggregate empirical tests. We begin by developing indices to measure the balance between market-oriented and strategic coordination in the political economy. We then assess the core postulates of the theory about institutional complementarities in the macroeconomy, devising further measures for this purpose. Finally, we examine patterns of political adjustment and institutional change in order to assess the durability of the national distinctions identified by this approach. Before considering its specific propositions, we open with an overview of the varieties-of-capitalism perspective
: This chapter considers the politico-economic management of unemployment and inflation in developed capitalist democracies, focusing on the institutional and structural features of labor and goods markets and the credibility and conservatism of the monetary-policy authority. It reviews the central-bank-independence (CBI) and coordinated-wage-/price-bargaining (CWB) literatures and then offers a synthesis and extension which emphasizes that the degrees of CBI and CWB interact, with each other and with the sectoral structure of the economy, to structure the incentives facing the politico-economic actors involved in monetary policy and wage/price bargaining. The empirical records of 21 OECD countries in the post-Bretton Woods era are then used to evaluate the emergent hypotheses. The conclusion addresses two questions of pressing intellectual and practical concern: the likely impact of and independent European central bank and the roots of the "collapse" of CWB. I. Introduction Politica...
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