The Political Economy of Growth Models

Lucio Baccaro

Comparative political economy has not adequately incorporated aggregate demand into its models and may have focused too strongly on analyzing "supply-side institutions" across countries. This is the conclusion Baccaro and Pontusson draw in their 2016 article in Politics & Society. They argue 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. The research project aims to extend the growth model perspective. Exploring how growth models reflect hegemonic coalitions, which straddle class and sectoral divides and are able to define their interests as the national interest, the project examines how such coalitions can be empirically identified, how they differ across countries, and how they change. Escaping the trade-off between stimulating domestic consumption and boosting (net) exports implies expanding export sectors with a lower price elasticity of demand. What are these sectors? What socioeconomic preconditions and policy choices are necessary to accomplish this shift? Project duration: September 2017 to December 2022.

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