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State‐Capacity between International Markets and Corporatism: The Case of Denmark
Author(s) -
Klausen Jytte
Publication year - 1987
Publication title -
scandinavian political studies
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.65
H-Index - 41
eISSN - 1467-9477
pISSN - 0080-6757
DOI - 10.1111/j.1467-9477.1987.tb00076.x
Subject(s) - corporatism , welfare state , subsidy , politics , market economy , social partners , political economy , welfare , economics , state (computer science) , flexibility (engineering) , compensation (psychology) , economic system , economic policy , public economics , business , political science , law , psychology , management , algorithm , computer science , psychoanalysis
This article examines Danish welfare and industrial policies to see if Peter Katzenstein's description of such policies as instances of a successful strategy of compensation for the social costs of an open economy and adaptation to international markets is correct. It is argued that the universal welfare state and corporatism pose severe restrictions on policy flexibility Universality of benefits is conducive to political consensus but also expensive because no one party is willing to assume the political costs of substantial change. Similarly, the comprehensive inclusion of organized interests in the formation and administration of industrial policies prevents the exclusion of any one organized interest from a share of government subsidies. Consequently, policies are broad and consensus‐generating rather than flexible responses to changes in international markets. It is concluded that the domestic interest group representation arrangements inhibit global adjustment.