Business Groups in 20^th‐Century Swedish Political Economy: A Sociological Perspective

Abstract

Since the interwar period, the Swedish economy has been dominated by a few business groups that control practically all Swedish industry of any importance. This article provides a sociologically informed account of the existence and lasting dominance of business groups in Sweden. In challenging efficiency‐based accounts of business groups in Sweden offered by transaction‐cost economists, I adopt a historical and dynamic approach that understands economic institutions not as efficient responses to external circumstances, such as market conditions, but as “social constructions.” This approach emphasizes the role of contingency as well as agency in the formation and reproduction of institutions. The article demonstrates the historical contingencies of the emergence of the business groups—in the form of economic crises in the interwar period—and how the groups became institutionalized in the postwar period through a process of social exchange among the key actors in the Swedish political economy: the business elite, the trade unions, and the state.

Defying Convergence: Globalisation and Varieties of Defence-Industrial Capitalism

“…These firms expanded during the Second World War and Cold War due to the Swedish government's political commitment to defence-industrial self-sufficiency. In the meanwhile, Sweden's defence firms became increasingly integrated into the country's distinctive form of CME, known as the 'Swedish Model' of capitalism (Smångs 2008). Within this context, individual corporations operated as monopolist 'national champions' within their respective domains and belonged to broader 'business groups' linking each of them to one of Sweden's commercial banks via equity ties (Olsson 1977, Högfeldt 2005.…”