Extending Varieties of Capitalism to Emerging Economies: What can We Learn from Brazil?

Abstract

In this paper we argue that efforts to apply Varieties of Capitalism to emerging economies can retaining a central role for institutions as constraining, it is important to incorporate into the analysis the nature and role of social blocs and the development of growth regimes. The paper develops a framework that systematically explores the links and interactions between institutions, the politics of social blocs and the viability of growth regimes as a way of understanding the trajectory of varieties of capitalism. We illustrate the value of this framework by applying it to developments in Brazil over the last three decades. In our concluding section, we describe how the application of the framework can be broadened not just to other emerging economies but also to the challenges currently being faced by advanced capitalist democracies.We identify a series of research questions developing and applying insights from this framework.A theoretically renewed comparative capitalisms approach to emerging economies is therefore potentially going to provide a payoff to developing a global perspective on forms of capitalism and their trajectories.

Intro: Comparative Capitalism Research in Emerging Markets – A New Generation

“…Thus, Schedelik et al (2020) show that interpersonal formation of social blocs and informal (not formal) interest organisations are key features of the four EM varieties that they identify. Similarly, focusing on the Brazilian case, Morgan et al (2020) show in very convincing fashion how the social bloc the Brazilian labour governments of the early 2000s managed to create was strong enough to allow for the emergence of a fairly successful, but shortlived consumption-driven growth model, but ultimately too weak to support fundamental institutional reform. This hints at the important fact that social blocs and institutions are not alternative explanations, but rather relate to each other in complex ways.…”

“…The three papers in this special section constitute examples of a new generation of CC research on EMs, which remedy some of the weaknesses of the VoC approach by drawing on GMP and Regulation Theory to provide a more robust analytical framework for the study of EMs. The authors argue thatthus enhancedcomparative capitalism in EMs can not only allow us to better understand these cases, but also allows us to better understand struggling advanced economies (Morgan et al, 2020), and can even constitute an alternative to dominant institutional paradigms in development studies (Schedelik et al 2020).…”

The diffusion of biogas systems in Brazil

“…Global South countries, like Brazil, experience high political and economic volatility (Wieczorek, 2018). Hence, strategies that allow flexibility and rapidly respond to changes from actors are usually preferable (Morgan et al, 2020). This also explains why small-scale biogas facilities have diffused faster than large-scale ones.…”

Elephant limps, but jaguar stumbles: Unpacking the divergence of state capitalism in Brazil and India through theories of capitalist diversity

“…Only growth and soaring corporate profits held this heterogeneous social bloc together, spurred by cheap state lending, rising domestic demand, public infrastructure investments and household financialization. When growth faltered and government demand stimulus waned, powerful business groups such as the São Paulo Federation of Industries and the Brazilian Agribusiness Association deserted the social bloc and actively supported the impeachment process of Dilma Rousseff (Morgan et al., 2020: 8). Whereas anti-corruption movements also led to a short period of declining investment rates in India, the social bloc remained largely intact, thereby limiting economic damage.…”