Institutions and Economic Growth: The Politics of Productivity in West Germany, Sweden, and the United Kingdom, 1945–1955

Abstract

This article reviews Mancur Olson’s ideas concerning the impact of institutions on growth rates and national competitive performance. We suggest that Olson’s “ideal typical” methodology limits the usefulness of his approach and that institutional structures and strategies can be dependent variables. In comparing the performance of three European countries in the postwar period, we argue (contrary to strict Olsonian principles) that changing market and political environments helped to determine the kind of institutional forms that emerged. We question the weight that Olson places on the role of institutional structures and strategies on long-run economic performance.

Understanding West German economic growth in the 1950s

“…Their number and the autonomy of shop stewards on the factory floor frustrated efforts to achieve the industry-wide, much less economy-wide, coordination of bargaining. None of this changed as a result of World War II (Booth et al 1997, Flanagan et al 1974. With scores of unions squabbling over their members' shop-floor rights, work rules proved difficult to modify.…”

Self-interest, Legal Commitment and Benevolence: The Emergence and Enforcement of a Swiss Labour Market Institution

“…As early as 1949, SMUV publicly acknowledged that better wages and working conditions mainly relied on productivity growth (Humbel, 1987). A comparable rationale may be found in other countries such as Sweden (Booth et al, 1997).…”