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 Research Projects at the MPIfG

Introduction to "Political Economy of Growth Models"

Lucio Baccaro


 
For the past twenty-five years, comparative political economy (CPE) has focused on the analysis of differences in "supply-side institutions" across countries (wage bargaining institutions, vocational training, social protection systems, etc.). Building on Baccaro and Pontusson’s 2016 article in "Politics and Society," the project area "Political Economy of Growth Models" tries to move CPE research towards systematically incorporating both the level and composition of aggregate demand and income distribution in its analyses. Recent research by Baccaro and others suggests that growth models differ across countries. In the fifteen years preceding the 2008 crisis, growth was primarily pulled by consumption in the UK, (net) exports in Germany, exports and consumption in Sweden, and neither exports nor consumption in Italy. New research in the project area aims to extend and develop the growth model perspective, focusing especially on underlying social coalitions. These coalitions are conceived as straddling class and sectoral divides and being able to present their interests as coinciding with the national interest. Researchers in the project area will seek to answer such questions as: How do hegemonic social coalitions emerge? How can they be empirically identified? How do they change? The new research also aims to understand which structural conditions and policy choices bring about viable growth models. Of particular interest are policies promoting structural change that implies a shift from manufacturing to sectors with a lower price elasticity of demand, such as information and communications technology (ICT) and high value-added services. Is there a trade-off between stimulating domestic consumption and boosting (net) exports? If so, can it be relaxed? What are the structural and social preconditions for a successful transition to high value-added services?
 

 
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