Lecture 4

Question 1

what caused varieties of capitalism to grow steadily in the 1920s onwards ?

Answer 1

The collapse of the USSR

Question 2

What is the source of finance for anglo-american capitalism ?

Answer 2

Stock market

Question 3

What is the problem with the anglo-american source of finance ?

Answer 3

If company shares go down then cuts have to be made in the company.

Question 4

As an employee what benefits would you have working for a company that adopts Rhineland capitalism ?

Answer 4

reduced risk of being made redundant.

opportunity to be a stakeholder

Question 5

What type of capitalism allows companies to be easily taken over ?

Answer 5

Anglo-american

Question 6

Why are companies that adopt the rhineland capitalism approach less reliant on share price ?

Answer 6

banks sit on the board of the company, they can assess how the company is operating in the long term, which gives certainty to other investors

Question 7

What 2 models of capitalism did Hall and Soskice come up with ?

Answer 7

Liberal market economy model- USA

Coordinated market economy model -germany

Question 8

What did 5 economic activities did hall and soskice propose ?

Answer 8

Finance 
Employee relations 
Industrial relations 
Training 
inter company relations

Question 9

What are 3 possible consequences of Liberal market economies ?

Answer 9

Weaker job security
More power over what to pay people
pay linked to individuals performance

Question 10

What are 3 possible consequences of Coordinated market economies ?

Answer 10

Constraints on managerial freedom
Relative job security
More employee involvement

Question 11

Why is the UK less liberal market based than the US?

Answer 11

Due to EU policies that the UK has to follow

Question 12

What two business types according to Whitley are associated with LMEs and CMEs ?

Answer 12

− Collaborative (associated with CMEs), collectively organised and more collaboration between firms.
− Compartmentalized (associated with LMEs), Powerful firms able to dominate sectors and regions

Question 13

What two business types according to Whitley are associated with small firms ?

Answer 13

Fragmented: Dominated by small companies, able to move swiftly with few ties to other stakeholders
Coordinated Industrial District: Densely connected small firms, collaborating in local specialisms