France and Varieties of Capitalism

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France and Varieties of Capitalism

• Jan. 19

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Changing Role of the French State

• French Empire
• Development of the French State
• Political Instability and Economic Conservatism
• Postwar dirigiste state
• Crisis of the dirigiste model
• The contemporary French state

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French Empire

• From the 16th to 18th century, France competed
  with Britain for control over North America.
• Haiti became independent in 1804 (for info
  related to the recent disaster in Haiti, see the
  course website under Resources).
• However, in the 19th and early 20th century,
  France would aggressively rebuild and extend its
  empire in Africa, Southeast Asia and the Pacific.

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Development of the French State

• Louis XIV (1643-1715) sponsored the creation of a
  relatively efficient state bureaucracy, separate
  from the Crowns personal domain.
• For most of the period from the mid-17th to the
  mid-18th century, France was at war with its
  neighbours.

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Development of the French State

• France was the most powerful nation in Europe in
  the 17th century, but in the 18th century Britain
  challenged Frances pre-eminence.
• The attempt to raise taxes to cover state
  expenses and debts was one of the factors that
  led to the French Revolution in 1789.
• The First Republic was proclaimed in 1792.

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Political instability and relative (to Britain,
Germany) lack of economic development

• Napoleon 1799-1814
• Restoration 1814-1830
• July Monarchy 1830-1848
• Second Republic 1848-1851
• Second Empire 1852-1870
• Paris Commune 1871
• Third Republic 1871-1940
• Vichy Regime 1940-1944

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Postwar dirigiste state

• In the period following WWII, the French
  pioneered in developing methods to steer and
  strengthen the economy.
• From guardian of the established order, the
  French state became the sponsor of social and
  economic progress.

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Crisis of the dirigiste model

• Slowdown in economic growth in 70s.
• The massive shift of workers from agriculture to
  urban areas ran out of steam.
• Impact of energy crisis, oil shocks.
• New competition from new emerging industrializing
  countries

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Crisis of the dirigiste model

• 1981 Mitterrand and Socialists win elections.
• Facing business and international opposition,
  amid significant recession.
• Demand stimulus simply meant French consumers
  consumed more imported goods.
• Socialists make u-turn.

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Varieties of Capitalism
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Hall and Soskice

• liberal market economies (LMEs) US, UK, Canada,
  Australia, New Zealand, Ireland
• coordinated market economies (CMEs) Japan, most
  of continental Europe
• More ambiguous cases include France, Italy,
  Spain, Portugal, Greece, Turkey. a
  Mediterranean model?

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David Coates

• market-led capitalisms (US)
• state-led capitalisms (Japan)
• negotiated or consensual social capitalisms
  (Sweden, Germany)