?Particularistic? Liberalism: Industries, Institutions and Influence in Liberal Market Economies.

Globalization’s onset inspired predictions about convergence of diverse capitalist economies to American-style liberalism (Kurzer 1994; Frieden & Rogowski 1996). Even dissenters (Garrett 1998; Boix 1998; Hall & Soskice 2001; Kitschelt, Lange, Marks & Stephens 1999), who insisted on the persistence of different capitalist models, agreed on liberalism’s comparative advantages: fewer regulations, less particularistic policy-making, and swift asset redeployment. Rather than inspiring hands-off government, however, increased international competition has often been accompanied by industry-specific tax cuts and credits, subsidies, and import relief. Neither the convergence school nor its critics, can explain when and why the liberal market economies (LMEs) in the UK, US, and Canada stray from laissez-faire. This paper argues that political institutions explain divergence among LMEs. My argument is that the key variable distinguishing between the UK and US is the weakness of party discipline in the United States and its strong presence in the UK. The most important distinction in scholarly work, by contrast, has been between majoritarianism and proportional representation electoral systems (Rogowski 1987). Political party discipline influences politicians? incentives to adopt universalistic versus particularistic policies toward business in the aggregate, as well as policies regarding specific sectors. The policy result of weak party discipline is different from the result of federalism. In systems with weak party discipline, businesses can invest in particular favors from individual legislators. In federal systems, by contrast, the only industrial particularism is inter-state bids for mobile industries capable of making credible exit threats. [ABSTRACT FROM AUTHOR]