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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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    References listed on IDEAS

    1. Walker, James R, 1995. "The Effect of Public Policies on Recent Swedish Fertility Behavior," Journal of Population Economics, Springer;European Society for Population Economics, vol. 8(3), pages 223-251, August.
    2. Hotz, V-J & Kerman, J-A & Willis, R-J, 1996. "The Economics of Fertility in Developed Countries : A Survey," Papers 96-09, RAND - Labor and Population Program.
    3. Hans-Peter Kohler & Francesco C. Billari & José Antonio Ortega, 2002. "The Emergence of Lowest-Low Fertility in Europe During the 1990s," Population and Development Review, The Population Council, Inc., vol. 28(4), pages 641-680.
    4. Heckman, James, 2013. "Sample selection bias as a specification error," Applied Econometrics, Publishing House "SINERGIA PRESS", vol. 31(3), pages 129-137.
    5. Pedro Mira & Namkee Ahn, 2002. "A note on the changing relationship between fertility and female employment rates in developed countries," Journal of Population Economics, Springer;European Society for Population Economics, vol. 15(4), pages 667-682.
    6. Siv Gustafsson, 2001. "Optimal age at motherhood. Theoretical and empirical considerations on postponement of maternity in Europe," Journal of Population Economics, Springer;European Society for Population Economics, vol. 14(2), pages 225-247.
    7. Namkee Ahn & Pedro Mira, "undated". "Job bust, baby bust: The Spanish case," Studies on the Spanish Economy 12, FEDEA.
    8. Heckman, James J & Walker, James R, 1990. "The Relationship between Wages and Income and the Timing and Spacing of Births: Evidence from Swedish Longitudinal Data," Econometrica, Econometric Society, vol. 58(6), pages 1411-1441, November.
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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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