American Capitalism and Global Convergence: After the Bubble

Marina Whitman
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Marina Whitman: University of Michigan

No 540, Working Papers from Research Seminar in International Economics, University of Michigan

Abstract: Throughout the 1990s, the social-market capitalism that prevailed in most of the larger countries of continental Western Europe and the producer-oriented or mercantilist capitalism characteristic of Japan and a number of other large Asian economies were under strong pressures to migrate their economies toward U.S. (or Anglo-Saxon)-style investor capitalism. This paper explores whether the pressures for convergence exerted by globalization persisted into the first decade of the 21st century, after the American "bubble" burst and the United States fell from grace in a number of economic, social, and political dimensions. American-style investor capitalism indeed continues to be the dominant model where capital markets and corporate governance are concerned. Various pressures continue to push the labor markets of industrial nations in that direction as well, despite strong political and social backlash. Where relations with customers are concerned, however, it is the requirements imposed on products, services and production processes by the stringent regulations of the EU's social market capitalism, and its adherence to the precautionary principle, that dominate. At the same time, U.S.-style capitalism is itself evolving as its participants struggle to restore public trust and to integrate the adaptability and market-responsiveness of its institutions with a broadened focus on corporate responsibility to multiple stakeholders.

Pages: 20 pages
Date: 2003
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Persistent link: https://EconPapers.repec.org/RePEc:mie:wpaper:540

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