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Soskice: Divergent production regimes

Disclaimer. Don't rely on these old notes in lieu of reading the literature, but they can jog your memory. As a grad student long ago, my peers and I collaborated to write and exchange summaries of political science research. I posted them to a wiki-style website. "Wikisum" is now dead but archived here. I cannot vouch for these notes' accuracy, nor can I say who wrote them.

Soskice. Divergent production regimes: Coordinated and uncoordinated market economies in the 1980s and 1990s. In Continuity and Change in Contemporary Capitalism, ed.s Kitschelt, Lange, Marks, and Stephens, pp. 101-135.

Class notes:


There are two critical exogenous shifts that push for the need to change institutional frameworks. First, the liberalization of external markets increases government's dependence on the private sector to deliver good economic performance. Government, first, can no longer protect domestic companies, and, second, Keynesian polices have been made less easy by the openness of financial export markets without government assistance. The second exogenous shift is the technological paradigmatic shift as a result of the microprocessor. Hierarchical Fordist-type production of goods and services becomes uncompetitive.

CME-type frameworks allow actors to engage in long-term relationships in which two or more actors behave cooperatively together in the absence of strong monitoring systems. To be effective, companies have to accept three conditions, absent a powerful system of business organization. First, companies have to be prepared to engage in the transfer of information about their technological and skill requirements and competence. Second, the institutional framework has to protect companies from the adverse consequences of making investments co-specific assets. Third, the institutional framework continuously undertakes tasks in standard setting, rule setting, and sanctioning behavior.

The organization of business determines the organization of labor. Organized business leads to organized labor. Less organized business leads to less organized labor.

Research on similar subjects


Soskice, David (author)Comparative PoliticsMarketsCapitalismClass Conflict

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