Germany and Sweden as Cmes
To what extent would you regard Germany and Sweden as coordinated market economies?
1. Introduction
In an era where internationalism is contemporary, it has become crucial for countries to liberalize markets and renovate traditional structures. This is particularly important for countries whose social values and economic relationships are based on public coordination. This essay is going to explore the degree to which we consider Germany and Sweden as modern coordinated market economies, and the changes brought about in recent decades. To assess the changes we shall look at trends in trade union and employers’ association participations, collective bargaining reforms, training systems amendments, renewals in corporate governance and fluctuations of wage inequality; first by uncovering the basics in each element and then evaluating their stability in relation to globalization.
1.1 What is a coordinated market economy (CME)?
Being one of the wings of capitalism in which industrial relations and economic conditions are measured, as Bamber, Lansbury and Wailes (2011) state, CMEs can be used as “an approach for comparing…different countries, [with this comparison, it allows us] the understanding of convergence and/or divergence” between different economies. And in each of the key elements we mentioned, companies in CMEs resolve problems through relational, non-market based strategies and the outcome will be strongly dependent upon co-operation with supporting institutions.
2.1 Past dominance of trade unions and employers’ associations
A key feature of a CME is the dominance of employers’ association and trade unions within the country’s industrial relations; both Germany and Sweden have had a high degree of centralization during the 1980s. Trade unions were a powerful, acting as representative for labour in large corporations and also intermediaries of employment between labour and employers. A common characteristic is that the labour unions in the two
1. Introduction
In an era where internationalism is contemporary, it has become crucial for countries to liberalize markets and renovate traditional structures. This is particularly important for countries whose social values and economic relationships are based on public coordination. This essay is going to explore the degree to which we consider Germany and Sweden as modern coordinated market economies, and the changes brought about in recent decades. To assess the changes we shall look at trends in trade union and employers’ association participations, collective bargaining reforms, training systems amendments, renewals in corporate governance and fluctuations of wage inequality; first by uncovering the basics in each element and then evaluating their stability in relation to globalization.
1.1 What is a coordinated market economy (CME)?
Being one of the wings of capitalism in which industrial relations and economic conditions are measured, as Bamber, Lansbury and Wailes (2011) state, CMEs can be used as “an approach for comparing…different countries, [with this comparison, it allows us] the understanding of convergence and/or divergence” between different economies. And in each of the key elements we mentioned, companies in CMEs resolve problems through relational, non-market based strategies and the outcome will be strongly dependent upon co-operation with supporting institutions.
2.1 Past dominance of trade unions and employers’ associations
A key feature of a CME is the dominance of employers’ association and trade unions within the country’s industrial relations; both Germany and Sweden have had a high degree of centralization during the 1980s. Trade unions were a powerful, acting as representative for labour in large corporations and also intermediaries of employment between labour and employers. A common characteristic is that the labour unions in the two
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