1. Different forms of capitalism, different forms of society
Comparative Sociology
Week 15

2. Recap
Last week we looked at what comparative sociology is, and how it is done
Any questions, comments?
For the rest of the course, we are going to look at some particular comparisons
Beginning with different forms of capitalism

3. Outline Definition of capitalism Consider two different forms
Neo-American
Germanic
How do these different forms relate wider society?

4. Capitalism What are the key points of capitalism? Economic system
Private ownership of the means of production
Aim to make profits
Profits kept by owners of the means of production (apart from taxation)
‘Free’ labour force

5. Dominance of Capitalism
Capitalism is now dominates the world.
The collapse of communism in the old USSR
China’s move into private enterprise
But capitalism takes different forms.
Changes over time
Changes between places

6. Capitalisms Two distinct models Neo-American model Germanic model
Individual success
Short-term financial gain
Germanic model
Collective success
Long-term concerns

7. Neo-American model
Shift in the 1980s to the Monetarist school of economics in the US and the UK
Friedman
Minimum intervention by the government in the economy (Laissez-faire)
Belief that left alone the market will find equilibrium

8. Changes made Deregulation Tax reductions Control of money supply
Many industries moved to control themselves
Tax reductions
Particularly higher bands of taxation
Control of money supply
Inflation controls
Privatisation
Ending of state ownership

9. Free-Market
Supply and
demand
will
balance
themselves

10. Competition Competition between individuals
Headhunting of top personnel
Competition between companies
Market share
Competition for investors
Need to maximise profits to ensure shareholder confidence

11. What are the strengths and weaknesses of this form of capitalism

12. Impact of the policy under Thatcher
Interest rates increased in the 1980s to bring down inflation
Mass unemployment
Cuts were made to welfare provision
Widening gap between rich and poor

13. Impacts
Discuss with the people sitting next to you what impact you think these changes could have had?

14. Germanic model
Business closely linked to their country/region of origin
Cross-ownership of companies common
Extensive investment in training and research and development
Partnerships between workers and mangers
Collective bargaining/works councils
Extensive welfare provision

15. Advantages of Germanic model
High level of social responsibility
Job stability and security
Reduction of social inequalities
For German nationals

16. Problems with Germanic model
High cost of employment
Welfare costs
Training costs
Need to adapt to a global marketplace
International competition
Short vs long term orientation

17. Advantages and Disadvantages
Discuss with the people sitting next to you the advantages and disadvantages of the Germanic model of capitalism

18. Related to wider culture
American individualism?
Collective responsibility?

19. What do you think these different ideals say about the cultures of the different places?

20. American dream Nation build on immigration American Dream
Social mobility
Competition to be the ‘best’

21. German stability Borders changed but immigration lower
Social cohesion valued
Training/education collective responsibility

22. Summary Capitalism not a stable entity Two forms
Changes over time and between places
Two forms
Liberal market
Welfare capitalism
Considered how this relates to national cultures

23. Next week Look at national culture in more detail What is culture?
Hofstede’s studies on organisations
Inglehart’s comparative work on values
Cultural change?