One of the themes I’ll keep circling around is the role of markets in a democratic society. Scott Sumner has a pretty tendentious piece today (hat tip to MR) about “progressives” interpreting or mis-interpreting political-economic history, specifically the role of 1970s and ’80s market-based reforms in promoting (or not) economic growth. I’m going to find it tricky to reference these types of pieces without getting into the kinds of cul-de-sac debates that animate them. That kind of post has a goat that it wants to get, and in the recesses of my mind I hear a bleating “baaa!” as the goat gets got. Go chew on a can, goat, I’ve got blogging to do.

The useful concept that this piece gives me a reason to bring up is “varieties of capitalism.” This is the idea that Anglo-American more-or-less laissez-faire capitalism (which isn’t really that anymore nor was it ever all that much) is not the default, best, or only form of capitalism, but that European-Japanese “coordinated” capitalism, which features greater collaboration rather than antagonism between labor and capital, among other things, is a viable and maybe even preferable alternative. The question in the varieties-of-capitalism literature, or at least it was the question a few years back, is convergence: are the “coordinated” countries becoming more like the Anglo-American ones? Another way of asking this is, is the European model a function of the post-WWII boom that lasted through the ’70s, and can it no longer be sustained in a more modern, globalized economy? This has real implications for attempts to moderate Anglo-American capitalism through the provision of, oh, I don’t know, universal health care and things like that. Which is one of the many reasons why the current travails of the European monetary union are important.

If U.S. philanthropy in its institutional form is a function of U.S. capitalism, in part an artifact of the tax code, is there a varieties-of-philanthropy argument to be made alongside a varieties-of-capitalism one? An uncoordinated capitalism features a lot of decentralization, while a coordinated version has, for example, a more structured labor market, with closer links between employers, vocational schools, universities, and unions. Are emerging (and established) European versions of organized philanthropy mirroring the varieties of capitalism, or are they mimicking U.S. philanthropy? A question that may be worth exploring….


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