Seeking the Best Master
State Ownership in the Varieties of Capitalism
The economic crisis of 2008–2009 signaled the end of the Post-Washington Consensus on restricting the role of the state in economic and development policy. Since then, state ownership and state intervention have increased worldwide. This volume offers a comparative analysis of the evolution of direct state intervention in the economy through state-owned companies in Austria, Brazil, France, Germany, Hungary, Poland, Turkey, Singapore, and Slovenia. Each case study includes substantial explanations of historical, cultural, and institutional contexts.
All the contributors point to the complex nature of the current revival in state economic interventions. The few models that are successful cannot hide the potential problems of excessive state intervention, linked to high levels of moral hazard. State-owned enterprises are primary tools of market and price manipulation for political purposes. They can be used outright for rent seeking. Yet state-owned enterprises can also play important roles in prestigious national initiatives, like major public works or high-profile social and sports events. The authors conclude that after the uniform application of democratic market economic principles, the 2000s witnessed a path-dependent departure from standard economic and political operating procedures in developed countries.
About the Author
"The state is back—and not only for a transitory period. Lastingly negative real rates of interest coupled with fiscal laxity counts as the 'new normal' macro-economics, from the United States to the European Union and Japan. Parallel to this sea change, state activism is also revived. This means both an enhanced role of discretionary interventionism and a sustained role of public enterprises across the globe. The present collection provides ample evidence for how and why many countries at various levels of development opted for more activism—and more statism. As the title suggests, depending on the context, more active public policies may, and often do, translate into the shortest way to competitive markets. There is no golden route, no single best solution to ensure improved public welfare. Anyone interested in the theory and policy of comparative development should be confronted with the vast evidence, theoretical and empirical, marshalled in this volume."—László Csaba
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