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This paper investigates the effect of state-society relations on the industrially-related growth paths of developed countries.

It introduces a novel theoretical framework, the state-business-labor relations (SBLR) framework, where four main actors are identified: the state, big businesspersons or tycoons, owners and managers of small and medium enterprises (SMEs) or Entrepreneurs and labor. Different SBLR categories or modes are introduced depending on levels of coordination and power relations between the studied actors. The paper then investigates how these SBLR modes, through adopting various policies targeting the industrial sector, lead to different growth paths. Rather than focusing only on economic growth, this research regards a growth path as a matrix of the performance in long-run growth and equality of distribution.

Using regression analysis and statistical data, the results suggest that the Co-Balanced mode, having higher levels of coordination and lower favoritism, leads to the best growth path among the four introduced modes, especially with its emphasis on high levels of venture capital availability and easiness of starting business. while the Lib-Capture mode, characterized by lower coordination and higher favoritism, seems to have the worst growth path and the best implemented policy for this mode is suggested to be high profit taxes that seem to counter the negative impact of the existing high levels of favoritism.

Despite the important findings that this research has reached, this paper is mainly meant to open a further investigation into this topic and open this dimension that the research on VoC and political economy have under-researched. A deeper investigation of SBLR typologies that could only be possible by having richer datasets with more data on coordination for the whole world, rather than only the advanced economies, would further our understanding of the dynamics that shape the growth paths of different countries of the world.

To realize the best industrial growth path, fighting favoritism should be an important objective. The negative impact of favoritism on innovation could not be disregarded in the eve of the fourth industrial revolution, where innovation is increasingly pivotal to future industrial development. Actively engaging societal groups in the policymaking process is important in addressing their concerns and balancing them at the same time. This should lead to the double benefit of formulating better policies that should foster growth as well as provide better distribution of this growth. High levels of coordination should help in realizing this objective. Yet, this could only be possible if societal groups are free to associate and aggregate their power and when there are means of preventing one actor from gaining more favorite treatment and exclusive influence over policymakers. The presence of both powerful and broadly represented business associations and labor unions and the existence of a government interested in coordinating their efforts-rather than letting itself be controlled by one group at the expense of the others-should help in the realization of the best growth path. Thus, institutional reform that empowers societal groups and enables them to defend their interests as well as fights all forms of corruption should lead to the realization of a more prosperous and equitable industrial development, with the “re-industrialization” of the developed world being no exception. The technological and social challenges of intensive automation and digitalization accompanying the fourth industrial revolution make the envisaged institutional reform more urgent.

This paper is introducing a novel theoretical framework for studying the effect of state-society relations, particularly SBLR, on the industrial growth paths of developed countries. It integrates three important bodies of literature in order to build a more comprehensive understanding of the dynamics of state-society relations and their economic consequences. These are the Varieties of Capitalism (VoC), State-Business Relations (SBR) and Industrial Relations. The SBLR framework differentiates between tycoons and entrepreneurs, an important distinction that often goes unnoticed. Different SBLR categories or modes are introduced, depending on levels of coordination and power relations between the actors. It is proposed in this research that the effect on growth paths goes beyond the simple dichotomy between CMEs and LMEs usually present in the literature of VoC and that power relations provide an essential complementary dimension in explaining this causality.

This paper investigates the factors responsible for the emergence of different arrangements of state–society relations. Being concerned with the relations related to the industrial sector, this study focuses more on state–business–labor relations (SBLRs), especially on power dynamics between the main actors in these relations, namely, the state, tycoons, entrepreneurs and labor.

Based on power dynamics, four SBLR modes are identified and differentiated according to state power vis-à-vis non-state actors and tycoon power vis-à-vis the other non-state actors. The balanced mode is characterized by balanced power relations among the four considered actors. In the capture mode, tycoons are more powerful than other actors, including the state, although other nonsocial actors have organizational rights. The crony mode has powerful state, subservient tycoons who enjoy high levels of favoritism and low organizational power for the other social actors. Finally, the state-dominance mode has powerful state, low levels of favoritism to tycoons and low organizational power for all social actors. The paper then explores the factors responsible for the emergence of each of these modes by investigating the factors’ effects on state power and favoritism to tycoons. The investigated factors include historical political–economic, geographical, legal and cultural factors. The hypothesized effects of these factors are then tested using a random-effects probit regression model, investigating how the different factors affect the probability of the existence of the studied SBLR modes.

The results support much of the hypothesized relations and place more emphasis on some of the investigated factors. Earlier development is clearly responsible for the emergence of either the balanced or the state-capture SBLR mode. Geographical conditions favorable for development, such as latitude and metal richness, also lead to the emergence of either mode. The communist heritage, and more accurately the post-communist economic and incomplete political liberalism of the transition stage, contributed to the emergence of the state-capture SBLR mode. The British legal system, with the power it provides to non-state actors through the independence of judges and other measures, contributes to the emergence of the balanced SBLR mode. Cultural factors are largely responsible for the emergence of the crony SBLR mode, especially hierarchical and collectivist cultures, as well as ethnic fractionalization. On the other hand, the culture of Confucians has the strongest influence on the emergence of state dominance, while other cultures play a marginal role in its rise, and ethnic fractionalization marginally defuses the ability of the state to dominate without resorting to favoritism. Finally, access to rich natural resources, by enriching the state independently from social actors’ financial resources (e.g. taxation), marginally increases the probability of the emergence of the state-dominance mode.

There is room for path dependency to explain the emergence of different SBLR modes in many countries. Unfortunately, the introduced regression model and any quantitative empirical work would not be able to effectively investigate such a process. Instead, an approach depending on case studies and a deeper investigation of country-specific historical political development is needed to complement the research done here. Conducting such an additional quest would help in reaching a more comprehensive understanding of why different countries have different SBLR modes. This should ultimately help in answering an equally important question: How to reverse engineer the emergence of favorable SBLR modes?

Although this paper did not investigate the economic merits or mischiefs of each of the studied modes, it is plausible to think of the balanced SBLR as the best mode. This is supported not only by the fact that most of the countries of this mode are developed countries but also by the attractiveness of the power dynamics governing this mode—a more balanced power among different SBLR actors. While some factors are almost impossible to replicate, for example, geographical factors, reform could target the factors that could be changed or mitigated. This is true for legal reform, especially for fostering the independence of judges. Culture is often regarded as a sticky institution. However, this is not always true, even though the change happens in the long run. A sort of dynamism should always be considered when referring to culture through time and space. Institutional reform could be instrumental in the long run in this regard. Conducting such reform with the help of such “exogenous” institutions should always consider the match between these institutions and “endogenous” institutions, such as culture. That is to say, the connection between democratization, fostering accountability and curbing favoritism and cultural values leaning toward these principles should be firmly established. Finally, a point of optimism is that—based on the results of this paper—reaching a high state of development could increase the chances of realizing a more balanced SBLR mode in the long run.

This paper represents a novel contribution to a topic that has hardly been addressed in the literature. The methodology that is used identifies different state–society relation modes and focuses on power relations in SBLRs is another important contribution to the present literature in many fields, such as institutional economics, socioeconomics and political economy.

From the sixteenth to eighteenth century, China underwent a commercial revolution similar to the one in contemporaneous Europe. The rise of market did foster the rise of a nascent bourgeois and the concomitant rise of a liberal, populist version of Confucianism, which advocated a more decentralized and less authoritarian political system in the last few decades of the Ming dynasty (1368–1644). But after the collapse of the Ming Empire and the establishment of the Qing Empire (1644–1911) by the Manchu conquerors, the new rulers designated the late-Ming liberal ideologies as heretics, and they resurrected the most conservative form of Confucianism as the political orthodoxy. Under the principle of filial piety given by this orthodoxy, the whole empire was imagined as a fictitious family with the emperor as the grand patriarch and the civil bureaucrats and subjects as children or grandchildren. Under the highly centralized administrative and communicative apparatus of the Qing state, this ideology of the fictitious patrimonial state penetrated into the lowest level of the society. The subsequent paternalist, authoritarian, and moralizing politics of the Qing state contributed to China’s nontransition to capitalism despite its advanced market economy, and helped explain the peculiar form and trajectory of China’s popular contention in the eighteenth century. I also argue that this tradition of fictitious patrimonial politics continued to shape the state-making processes in twentieth-century China and beyond.

Transition into modernity takes very different roads, depending on the sequencing of bureaucracy and democratic regime. This is demonstrated by comparing Sweden and Greece. At an early stage of the long-term modernisation of Swedish society, due to early penetration of the internal territory and before the extension of suffrage and political modernisation, a number of state organisations were established at the interstices between state and society, creating direct relations between the state and society. The impressive Lantmäteriet, the organisation of tax authorities, the establishment of authorities for registering the population and the Tabellverket are typical illustrations of such organisational structures. Such organisations functioned as social mechanisms that elucidated society making it legible and thus strengthened the infrastructural capacity of the state. In Greece, where the state was built after political modernisation, the establishment of similar organisations proved to be more difficult. Although there is evidence that similar Swedish practices were known in Greece to be possible paths, they were not chosen. The establishment of a land registry system, for instance, was discussed in the decades prior to the 1871 land reform. On other issues, such choices could not be materialised given opposition or political counter-mobilisation to abolish the reforms after they were approved by parliament. These reform efforts were rather short-lived or countered by new reforms and exemptions, creating an ambiguous labyrinth of regulations of state–society relations and a state without the capacity to intervene in society and implement logistically political decisions throughout the realm. On the whole, the state remained a distant entity, mostly a distrusted one, and relations between the state and society were mediated by parties and by social and kinship-based networks.

When a major landslide and floods devastated Freetown, Sierra Leone had just overcome the Ebola crisis, which had left its mark on socio-political relations between different disaster response actors. With international disaster response frameworks increasingly shifting to local ownership, the national government was expected to assume a coordinating role. However, in “post-conflict” settings such as Sierra Leone, intra-state and state–society relations are continuously being renegotiated. This study aimed to uncover the complexities of state-led disaster response in hybrid governance setting at national and community levels in the response to the 2017 landslide and floods.

During the four months of fieldwork in Freetown in 2017, semi-structured interviews and focus group discussions with various state, aid and societal actors were conducted.

The findings show that a response to policy building on the idea of a uniform state response did not take into account intra-state power politics or the complexity of Sierra Leone's hybrid governance.

This paper argues for a more nuanced debate in humanitarian governance and practice on the localisation of aid in post-conflict and fragile settings.

The study's findings contribute to the literature on the disaster–conflict nexus, identifying paradoxes of localised disaster response in an environment with strong national–local tensions. The study highlights intra-local state dynamics that are usually overlooked but have a great impact on the legitimacy of different state authorities in disaster response.

This paper provides a political analysis of legal pluralism from a “new institutionalist” perspective. In response to question of why states recognize and incorporate non-state normative orderings into their legal systems, it is hypothesized that the decision of incorporation is made to enhance the capacities of postcolonial states with “rational” calculations. In this respect, two new categories of legal pluralism are introduced: capacity-enhancing recognition and capacity-diminishing recognition. The paper lastly assesses the implications of legal pluralism upon the state-society relations and individual rights and liberties of citizens in the case of Israel.