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Institutional competitiveness in the global economy: Denmark, the United States, and the varieties of capitalism
Author(s) -
Campbell John L.,
Pedersen Ove K.
Publication year - 2007
Publication title -
regulation and governance
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.417
H-Index - 45
eISSN - 1748-5991
pISSN - 1748-5983
DOI - 10.1111/j.1748-5991.2007.00012.x
Subject(s) - capitalism , neoliberalism (international relations) , welfare state , politics , socioeconomic status , state (computer science) , economics , economic system , inequality , state capitalism , market economy , political economy , political science , sociology , mathematical analysis , population , demography , mathematics , algorithm , computer science , law
Despite high taxes, a large welfare state, and much economic regulation, Denmark competes successfully against other advanced capitalist economies. Denmark’s success is based in large part on its institutional competitiveness – its capacity to achieve socioeconomic success as a result of the competitive advantages that firms derive from operating within a particular set of institutions. The institutional basis for successfully coordinating labor markets and vocational training programs are examined for Denmark and the US – two countries that were very different institutionally but very successful in the 1990s and in the 2000s. We show that there is no one best way to achieve success in today’s global economy, except with respect to social inequality; that the mechanisms underlying institutional competitiveness are more complex than often recognized; that institutional hybrids can be as successful as purer political economic cases; and that high taxes and state spending can enhance socioeconomic performance. As such, this paper challenges both neoliberalism and the varieties of capitalism school of comparative political economy.