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Corporatism, Profit Squeeze and Investment


  • Henley, Andrew
  • Tsakalotos, Euclid


This paper argues that the mainstream literature on corporatism focuses too narrowly on the relationship between corporatism and the labor market. It adopts a broader political economy perspective to argue that corporatist arrangements impart macroeconomic stability through the resolution of distributional conflict and through greater investment stability. Results for nineteen OECD economies are presented that demonstrate that economies with strong corporatist institutions have enjoyed much greater success in forestalling the profit squeeze of the 1970s and early 1980s. Further results also demonstrate that investment in such economies is more stable and resilient to movements in profitability. Copyright 1991 by Oxford University Press.

Suggested Citation

  • Henley, Andrew & Tsakalotos, Euclid, 1991. "Corporatism, Profit Squeeze and Investment," Cambridge Journal of Economics, Oxford University Press, vol. 15(4), pages 425-450, December.
  • Handle: RePEc:oup:cambje:v:15:y:1991:i:4:p:425-50

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    Cited by:

    1. Andrew Henley & Euclid Tsakalotos, 1992. "Corporatism and the European Labour Market after 1992," British Journal of Industrial Relations, London School of Economics, vol. 30(4), pages 567-586, December.
    2. Seguino, Stephanie, 1999. "The Investment Function Revisited: Disciplining Capital in Korea," MPRA Paper 6539, University Library of Munich, Germany.

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