Abstract
In this chapter, the authors (Eric Rougier and François Combarnous) identify and specify the six models of capitalism determined by clustering the country-specific sets of the seven types of sectoral governance detailed in the preceding chapters. The Liberal Market and Coordinated Market models are highly typical of OECD economies. In what specifically concerns developing and emerging economies, four distinctive models, the Globalization-Friendly, Resource-Dependent Statist, Informal (Weak State) and Hybrid-Idiosyncratic, have been found. One key result of the chapter is that institutional experimentation shows a strong pattern of differentiation between developing countries’ capitalisms, since transitional institutional models, that is, those that are no longer informal but not yet totally formal and OECD-style, are either non experimental (Statist Resource-Dependent or Globalization-Friendly) or experimental (Hybrid-Idiosyncratic).
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Notes
- 1.
Table 11.4 at the end of the present chapter lists those 140 national institutional configurations.
- 2.
- 3.
At each stage, the composition of the selected number of groups is governed by the general principle that countries are clustered into groups in which within-group heterogeneity is minimized, and between-group heterogeneity is maximized.
- 4.
Figure 14.1 is absolutely not the description of an historical evolutionary process. It is reported here because it gives useful clues about what are the most powerful and significant sources of differentiation of national institutional systems.
- 5.
Additional socioeconomic, political, historical or geographical characteristics that enable further differentiation of our clusters are analysed in Chap. 12.
- 6.
As from the second stage of differentiation, classification is less related to differences of economic development, since within-group heterogeneity of income per capita is high for Clusters 3, 4 and 5 that respectively correspond to the Hybrid-Idiosyncratic, Statist (Resource Dependent) and Globalization-Friendly models.
- 7.
This mixed classification procedure first implement a hierarchical cluster analysis and then consolidates the relevant partition through some k-means-like iterations aimed at increasing inter-cluster variance while minimizing intra-cluster variance.
- 8.
The relevant number of clusters (six in this case) is derived from the analysis of the dendrogram and the analysis of two indicators that (i) maximize the marginal improvement of the inter- to intra-cluster variance ratio from one given partition to another and (ii) minimize the impact of k-means consolidation on that ratio. Two classifications, one with five, the other with six clusters, proved valid in terms of generally accepted criteria. A comparison of these two classifications enables the robustness of our classification method to be confirmed, since four groups (Informal, Statist, CME and LME) remain essentially stable, whether five or six clusters are concerned, except for an extremely limited number of countries that are discussed below.
- 9.
Cluster 5 includes countries at all levels of income, ranging from the Gambia to Saudi Arabia.
- 10.
It should be noted that even when the classification process descends from six groups to five, the cluster remains unmodified.
- 11.
Despite a slight recent improvement, Indonesia’s ranking with respect to Doing Business indicators is still very low (126th for 2011), with the World Bank reporting that significant challenges remain, since labour regulation, infrastructure and the general regulatory burden still hamper investment and the reduction of poverty.
- 12.
- 13.
This result holds for all possible sources of governance indicators: ICRG, World Bank WGI, enforceability of contracts, index of property rights, rule of law, corruption indexes for all sources. The contract enforceability Indicator comes from Djankov et al. (2003), and the score of property rights enforcement is taken from the Heritage foundation.
- 14.
Argentina is the only exception to this rule.
- 15.
Azerbaijan, which has been reported as having carried out the greatest number of regulatory reforms in 2008, ranks 33rd in the category “regulatory ease of doing business”, having leapt from 96th to 33rd rank between 2007 and 2008 (World Bank Doing Business, 2009). Likewise, in 2010, Kazakhstan was recognized by the same source (World Bank Doing Business, 2011) as the “top reformer” in the world, moving up 15 points to 59th place.
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Rougier, E., Combarnous, F. (2017). The 2 + 4 Varieties of Capitalist Systems. In: Rougier, E., Combarnous, F. (eds) The Diversity of Emerging Capitalisms in Developing Countries. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-49947-5_11
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