d i s c u s s i o n p a p e r s
I I M V / A r b e i t s m a r k t p o l i t i k - I I M / L a b o u r M a r k e t P o l i c y W i s s e n s c h a f t s z e n t r u m B e r l i n
IIM/LMP 81 - 13
THE ORGANIZATION OF BUSINESS I N T E R E S T S A Research Design to Study the A s s o c i a t i v e A c t i o n of Business i n the Advanced I n d u s t r i a l S o c i e t i e s
of Western Europe
Revised and Extended Version, August 1981 by
P h i l i p p e C. Schmitter"1"^,.,..—-
+ + I
I - Wolfgang Streeck J " V '"¡ "7- . il
L
lnv. M i •Professor, U n i v e r s i t y o f Chicago
P r e s e n t l y Guest Fellow, I n t e r n a t i o n a l I n s t i t u t e of Management, 1980-1981
Fellow, I n t e r n a t i o n a l I n s t i t u t e o f Management
ISSN N r . 0 7 2 0 - 4 9 1 4
Part I of t h i s paper was adapted from IIM D i s c u s s i o n Paper 80-23 (W. Streeck, Ph. Schmitter, A. M a r t i n e l l i : The Organization of Business I n t e r e s t s : A Proposal to Study the A s s o c i a t i o n A c t i o n of Business i n the Advanced I n d u s t r i a l S o c i e t i e s of Western Europe)
P l a t z d e r L u f t b r ü c k e 1 - 3 1000 B e r l i n 42
T e l e f o n (030) 69041
A b s t r a c t
The paper presents a t h e o r e t i c a l and t e c h n i c a l o u t l i n e
f o r a c r o s s - n a t i o n a l comparative study of business a s s o c i a t i o n s . I t s t a r t s with a d i s c u s s i o n of the reasons f o r studying the o r g a n i z a t i o n a l p r o p e r t i e s of business a s s o c i a t i o n s i n the context of a p o l i t i c a l - e c o n o m i c theory of neo-corporatism.
The paper i d e n t i f i e s two c l u s t e r s of independent v a r i a b l e s that are assumed to a f f e c t the o r g a n i z a t i o n a l s t r u c t u r e of
business i n t e r e s t i n t e r m e d i a r i e s : p r o p e r t i e s of the represented group ("Logic of Membership") and p r o p e r t i e s of the State and other p o l i t i c a l i n s t i t u t i o n s such as trade unions ("Logic of
I n f l u e n c e " ) . I t goes on to "develop a model of the o r g a n i z a t i o n a l p r o p e r t i e s of business a s s o c i a t i o n s as they respond to these
two logics and to other f u n c t i o n a l exigencies ("Logic of Goal Formation" and "Logic of E f f e c t i v e Implementation"). In a
f u r t h e r step, the paper suggests four o r g a n i z a t i o n a l dimensions ("Domains", " S t r u c t u r e s " , "Resources", "Outputs") i n which the
" o r g a n i z a t i o n a l development" of business a s s o c i a t i o n s from lower to higher levels of "organized complexity" and " s t r a t e g i c autonomy" can be s t u d i e d . The paper i s concluded by an e m p i r i c a l research design and a d e s c r i p t i o n of the o r g a n i z a t i o n of the p r o j e c t . A l i s t o f the v a r i a b l e s i n c l u d e d , the d e f i n i t i o n of
the economic sectors s e l e c t e d f o r study, and a set of o p e r a t i o n a l
i n d i c a t o r s to be a p p l i e d by a l l p a r t i c i p a t i n g n a t i o n a l research
teams are contained i n an Appendix.
Zusammenfassung
Das Papier enthält einen t h e o r e t i s c h e n und methodischen Ent- wurf für eine i n t e r n a t i o n a l vergleichende Studie von W i r t - schaftsverbänden. Es beginnt mit einer D i s k u s s i o n der Gründe für eine Untersuchung der o r g a n i s a t o r i s c h e n Eigenschaften von Wirtschaftsverbänden im Zusammenhang der politisch-öko- nomischen Theorie des Neo-Korporatismus. Das Papier benennt zwei Gruppen von unabhängigen V a r i a b l e n , d i e d i e Organisa- t i o n s s t r u k t u r von intermediären Wirtschaftsverbänden b e e i n - f l u s s e n : Eigenschaften der vertretenen Gruppen ("Mitglieder- Logik") und Eigenschaften des Staates und anderer p o l i t i s c h e r I n s t i t u t i o n e n wie Gewerkschaften ("Einfluß-Logik"). Im An- schluß daran wird e i n Modell der o r g a n i s a t o r i s c h e n Eigen-
schaften von Wirtschaftsverbänden a l s Ausdruck der Einwirkung der beiden genannten "Logiken" sowie anderer f u n k t i o n a l e r Zwänge ("Logik der Z i e l f o r m i e r u n g " , "Logik der e f f e k t i v e n Z i e l v e r w i r k l i c h u n g " ) e n t w i c k e l t . Danach werden
vier o r g a n i s a t o r i s c h e Dimensionen vorgeschlagen ("Domänen",
"Strukturen", "Resourcen", ""Tätigkeiten"), i n denen d i e
" o r g a n i s a t o r i s c h e Entwicklung" von Wirtschaftsverbänden von n i e d r i g e r e n zu höheren Niveaus " o r g a n i s i e r t e r Komplexität"
und " s t r a t e g i s c h e r Autonomie" untersucht werden kann. Das Papier endet mit einem empirischen Forschungsplan und e i n e r Beschreibung der P r o j e k t o r g a n i s a t i o n . Eine L i s t e der einbe-
zogenen V a r i a b l e n , d i e Abgrenzung der für d i e empirische
Untersuchung ausgewählten W i r t s c h a f t s s e k t o r e n und e i n Satz
o p e r a t i o n e l l e r Indikatoren, der von a l l e n teilnehmenden For-
schungsgruppen gleichermaßen verwendet wird, s i n d i n >einem
Appendix e n t h a l t e n .
TABLE OF CONTENTS
I. WHY STUDY THE ORGANIZATION OF BUSINESS INTEREST ASSOCIATIONS ? 1.1. THE SUBSTANTIVE PROBLEM: Business I n t e r e s t s as the
Subject o f A s s o c i a t i v e A c t i o n 1.2. EXISTING RESEARCH
1.3. THE THEORETICAL DOMAIN
1.3.1. THE POLITICAL IMPERATIVES FOR BUSINESS ASSOCIABILITY
1.3.2. THE ORGANIZATIONAL REQUIREMENTS FOR BUSINESS ASSOCIABILITY
1.3.3. POLICY CONSEQUENCES OF BUSINESS ASSOCIABILITY
I I . THE RESEARCH PROBLEM: Business A s s o c i a t i o n s as the Object of E m p i r i c a l Research
I I . 1 . THE UNIVERSE OF ANALYSIS II.1
11.1.1. THE UNITS OF RESEARCH: A s s o c i a t i o n s 11.1.2. THE NATURE OF "INTEREST": S e l f - r e g a r d i n g ,
S e l f - d e f i n i n g , R a t i o n a l
11.1.3. THE SCOPE OF INTEREST: Business 11.1.4. SUMMARY
I I I . THE VARIABLES FOR ANALYSIS
111.1. THE COMPETING IMPERATIVES AND LOGICS OF BIAS 111.2. THE LOGIC OF MEMBERSHIP
111.2.1. NUMBER 111.2.2. EQUALITY 111.2.3. COMPETITION
I I I .2.3.1.. ' EXTERNAL COMPETITION III.2.3.2. INTERNAL COMPETITION 111.2.4. INTERDEPENDENCE
111.2.5. HETEROGENEITY 111.2.6. TURNOVER
111.2.7. PROFITABILITY AND GROWTH (A) Product C y c l e
•(B) Business C y c l e III'. 2.8. SOCIAL COHESION
III.2.9. CONCLUDING REMARKS ON THE LOGIC OF MEMBERSHIP
I I I . 3 . THE LOGIC OF INFLUENCE
III.3.1. INTERACTIONS WITH THE STATE
111.3.1.1. GENERAL (NATIONAL) CONDITIONS 111.3.1.2. SPECIFIC (SECTORAL) CONDITIONS
III.3.2. INTERACTIONS WITH TRADE UNIONS
111.3.2.1. GENERAL (NATIONAL) CONDITIONS 111.3.2.2. SPECIFIC (SECTORAL) CONDITIONS I I I . 4 . ORGANIZATIONAL PROPERTIES
III.4.1. INTRODUCTION
111.4.1.1. ORGANIZATIONAL DEVELOPMENT : Organized Complexity and R e l a t i v e Autonomy
111.4.1.2. DOMAINS, STRUCTURES, RESOURCES, OUTPUT III.4.2. DOMAINS
III..4.2.1. PARAMETERS
111.4.2.2. UNITS OF MEMBERSHIP 111.4.2.3. VARIABLES
III.4.3. STRUCTURES
111.4.3.1. INTRA-ORGANIZATIONAL STRUCTURES 111.4.3.2. HIGHER-ORDER ASSOCIATIONS
111.4.3.3. INTER-ORGANIZATIONAL STRUCTURES 111.4.4. RESOURCES
111.4.5. OUTPUTS IV. THE DESIGN OF RESEARCH
IV.1. THE SAMPLE OF SECTORS
IV.1.1. DEFINITION OF SECTORS IV.1.2. SELECTION OF SECTORS
IV.1.3. RELATIONSHIP TO ASSOCIATIONAL STRUCTURES IV.1.4.* RELATIONSHIP TO UNITS OF ANALYSIS
IV.2. THE SELECTION OF COUNTRIES
IV.2.1. STRATEGIES OF COMPARISON IV.3. THE ORGANIZATION OF THE PROJECT
IV.3.1. SIMILARITY OF DESIGN IV.3.2. STANDARDIZATION OF DATA
IV.3.3. RESPONSIBILITIES AND PROPERTY RIGHTS OF PARTICIPANTS
I. 'WHY STUDY THE ORGANIZATION OF BUSINESS INTERESTS ?
1.1. THE SUBSTANTIVE PROBLEM: Business I n t e r e s t s as the Subject of A s s o c i a t i v e A c t i o n
The e f f o r t s of business to advance or defend i t s i n t e r e s t s c o l l e c t i v e l y have a t t r a c t e d s u r p r i s i n g l y l i t t l e a t t e n t i o n from s c h o l a r s . At the very f i r s t meeting of the German S o c i o l o g i c a l A s s o c i a t i o n i n 1907 Max Weber ad- vocated a s s i g n i n g v e r y high p r i o r i t y to the systematic study of V e r e i n s -
wesen i n general and to the a s s o c i a t i v e a c t i v i t i e s of business i n p a r t i c u l a r . The emergence o f these new forms o f c o l l e c t i v e a c t i o n , he argued, should be r e l a t e d e x p l i c i t l y t o fundamental transformations of s o c i a l values and m a t e r i a l e x i s t e n c e . Despite d i s t i n g u i s h e d e a r l y contributions'
from German s c h o l a r s such as. R. von Kaufmann (1879), R. Graetzer (.1890), R. Liefmann (1897), H.A. Buech (1904), G. Schmoller (1905), G. K e s s l e r
(1907), W. Kuhlemann (1908-13), S. Tschierschky (1908, 1913), H.E. Kriiger (1909), Adolf Weber (1910), Leo Miiffelmann (1912), E. Lederer (1912, 1922), E. Tatarin-Tarnheyden (1922), H. Lechtape (1926), and E. Hamm (1929),
Weber's p l e a has gone l a r g e l y unanswered. E s p e c i a l l y s i n c e the Second World War, research on business a s s o c i a t i o n s f e l l i n t o the mould of "press- ure group s t u d i e s " , i n s p i r e d by work done e a r l i e r i n the United S t a t e s . European country a f t e r European country was "covered" by i s o l a t e d d e s c r i p -
t i v e monographs, most without h i s t o r i c a l depth and . cut o f f from broader, t h e o r e t i c a l l y informed, analyses of s o c i a l and economic trends.
The l i t e r a t u r e on contemporary p o l i t i c s i n Western Europe continues, of course, to' abound with references to the a c t i v i t i e s of i n d i v i d u a l
"captains of i n d u s t r y " , the r o l e of s p e c i f i c e n t e r p r i s e s , and the imputed i n f l u e n c e of c a p i t a l i s t s as a c l a s s , but r e l i a b l e information, much l e s s a n a l y s i s , on the resources, o r g a n i z a t i o n a l c h a r a c t e r i s t i c s , a t t i t u d e s ,
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a c t i v i t i e s and s t r a t e g i e s of formal a s s o c i a t i o n s s p e c i a l i z e d i n the p r o - motion and•protection o f trade and/or employer i n t e r e s t s i s r a r e . Even r a r e r are e f f o r t s to e x p l a i n how these dimensions of i n t e r e s t p o l i t i c s evolve over time and change i n response to v a r y i n g contexts and c o n f l i c t s .
T h i s conspicuous s i l e n c e on the s u b j e c t o f " o r g a n i z i n g c a p i t a l i s t s "
compared, f o r example, to the c o n s i d e r a b l e noise generated by the t o p i c o f
"organizing workers" i s puzzling.. P a r t o f i t may stem from the g r e a t e r sym- pathy aroused by "wage s l a v e s " and " e x p l o i t e d underdogs",' and a general p o l i t i c a l o r i e n t a t i o n i n the s c h o l a r l y community which has looked on the c o l l e c t i v e e f f o r t s of employers a t defending t h e i r i n t e r e s t s as l e s s l e g i t - imate and c e r t a i n l y l e s s h e r o i c than comparable e f f o r t s o f workers. Some of the l a c k o f a t t e n t i o n may be a t t r i b u t e d t o the secrecy and c o n f i d e n t i a l - i t y which tends to surround the o p e r a t i o n of business a s s o c i a t i o n s and, hence, greater problems of a c c e s s i b i l i t y by s c h o l a r s to the data necessary to evaluate o b j e c t i v e l y the r o l e o f such a s s o c i a t i o n s i n the p o l i t i c a l l i f e of advanced Western democracies.
But a major reason why r e s e a r c h has bypassed t h i s t o p i c — a f t e r the promising but a b o r t i v e s t a r t i n the f i r s t decades of t h i s century —• i s t h a t observers o f q u i t e d i f f e r e n t i d e o l o g i c a l and p o l i t i c a l persuasions have tended t o agree t h a t such e x p l i c i t — f o r m a l l y organized — expressions of c l a s s , s e c t o r a l or p r o f e s s i o n a l i n t e r e s t are r e l a t i v e l y unimportant i n the p o l i t i c a l process. Although the data on which t h i s assumption i s based
are very scanty and the judgments q u i t e i m p r e s s i o n i s t i c , the s u s p i c i o n p e r - s i s t s t h a t the " r e a l " promotion and p r o t e c t i o n of business i n t e r e s t s some- how flows through other channels o f r e p r e s e n t a t i o n and i n f l u e n c e .
Conservatives p o i n t to the continuous volume of complaints, u n s a t i s - f i e d demands and defensive a c t i o n s as evidence f o r the Impotence o f "pro- ducer" a s s o c i a t i o n s , and to the steady i n c r e a s e i n s t a t e r e g u l a t i o n of
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firms and p u b l i c i n t e r f e r e n c e with markets as proof of the c l o u t o f " a n t i - business" i n t e r e s t s .
L i b e r a l p l u r a l i s t s observe the v a s t number and v a r i e t y of fragmented, overlapping p r o p e r t i e d i n t e r e s t s organized i n t o m u l t i p l e , s p e c i a l i z e d as- s o c i a t i o n s with v a r y i n g resources and p r e c a r i o u s existences and deny both the e x i s t e n c e of some imputed, u n i f i e d , d i s t i n c t i v e , i n t e r e s t of business as a c l a s s and the relevance of paying any more s p e c i a l a t t e n t i o n to t h i s
"group" than t o , say, a n t i - v i v i s e c t i o n i s t s , a i r l i n e passengers or tax-payers.
The s i l e n c e on the p a r t o f M a r x i s t s i s a b i t more d i f f i c u l t t o under- stand. For them, the c l a s s i n t e r e s t s of c a p i t a l i s t s are r e a l and a p p r e c i - able, and presumably they must somehow .be e x p l i c i t l y organized, or, a t l e a s t , c o n s c i o u s l y coordinated. Many contemporary Marxists may (unknowing- ly) be agreeing with the s o c i o l o g i c a l o b s e r v a t i o n put f o r t h by F r i e d r i c h Engels already i n 1881 t h a t :
C a p i t a l i s t s are always organized. They need i n most cases no formal union, no r u l e s , o f f i c e r s , e t c . T h e i r smaller number, as compared with t h a t of workmen, the f a c t of t h e i r forming a separate c l a s s , t h e i r constant s o c i a l and commercial i n t e r c o u r s e stand them i n l i e u of t h a t . (1940, 17)
I f business i n t e r e s t s do not, (cannot?), f i n d expression through formal as- s o c i a t i o n a l channels, the focus of a t t e n t i o n must s h i f t to other, l e s s v i s - i b l e , c o o r d i n a t i v e arrangements such as banks ( H i l f e r d i n g , 1910); i n t e r - l o c k i n g corporate d i r e c t o r a t e s (Warner and Unwalla, 1967; A l l e n , 1974) or s o c i a l gatherings (Domhoff, 1974). " S t r u c t u r a l " Marxists may pre- f e r to take refuge i n the axiomatic p o s i t i o n t h a t the contemporary s t a t e performs the f u n c t i o n of mediating and c o o r d i n a t i n g the higher general i n t e r e s t s of c a p i t a l i s t reproduction. The observable, immediate and o f t e n
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c o n t r a d i c t o r y expressions of i n t e r e s t on the p a r t of c a p i t a l i s t s and t h e i r a s s o c i a t i o n s are, a t best, to be t r e a t e d as an i l l u s o r y , convenient facade designed t o provide the s t a t e with a f a l s e image of n e u t r a l i t y and u n i - v e r s a l i t y - A t worst, they could be regarded as an impediment t o the r e a l i z - a t i o n o f the c l a s s1 longer term i n t e r e s t i n accumulation and expanded r e - p r o d u c t i o n . Ergo, business should not organize i n t o autonomous a s s o c i a t i o n s or, i f i±v.doesy those i n p o s i t i o n s of s t a t e power should be c a r e f u l not t o pay a t t e n t i o n t o these o r g a n i z a t i o n s .
Eppur s i muove! Despite a l l these reasons why employers and e n t r e -
preneurs should not form, a s s o c i a t i o n s or why, i f they do, they are not l i k e l y to be s u c c e s s f u l , the owners and managers o f p r o d u c t i v e property have j o i n e d with each other i n formal o r g a n i z a t i o n s to advance and defend t h e i r i n t e r e s t s . E s p e c i a l l y s i n c e the decade i n which Engels wrote, "trades unions o f c a p i t a - t a l i s t s " , as he c a l l e d them, have emerged i n large numbers. They have, a t l e a s t i n c e r t a i n cases, acquired a s u b s t a n t i a l d e n s i t y of membership and
amassed considerable p h y s i c a l and human resources. They have even succeeded, i n some c o u n t r i e s and p o l i c y arenas, i n e s t a b l i s h i n g themselves as i n d i s -
pensable i n t e r m e d i a r i e s i n the exchanges between i n d i v i d u a l c a p i t a l i s t s , t h e i r firms and the s t a t e , and as important dispensers of s e r v i c e s
to t h e i r members and wider p u b l i c s .
Unless we are w i l l i n g to b e l i e v e t h a t businessmen c r e a t e , j o i n and support such a s s o c i a t i o n s a l t r u i s t i c a l l y and/or i r r a t i o n a l l y , or unless we are prepared to d i s m i s s t h e i r a c t i v i t i e s as an e l a b o r a t e (and expensive) charade, we must recognize t h a t "trades unions of c a p i t a l i s t s " do e x i s t and operate i n response to important, c a l c u l a b l e reasons and s t r a t e g i c motives, and t h a t t h e i r presence i n the p o l i t i c a l process w i l l have a s i g - n i f i c a n t p o l i c y impact. We must take a systematic look a t why, when and.
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how such a s s o c i a t i v e e f f o r t s have occurred, and what have been the r e s u l t - ant products of such e f f o r t s .
Moreover, we have reasons t o b e l i e v e that t h e i r s i g n i f i c a n c e — d i r e c t and i n d i r e c t , intended and unintended, p o s i t i v e and negative — has grown enormously i n recent decades t o the p o i n t t h a t the o r g a n i z a t i o n a l con- f i g u r a t i o n and i n s t i t u t i o n a l resources of business1 a s s o c i a t i o n s have be- come major determinants, not merely of. s p e c i f i c p o l i c y d e c i s i o n s , but o f the general v i a b i l i t y of democratic regimes i n advanced i n d u s t r i a l s o c i e t i e s . For reasons which w i l l be s p e l l e d out below, we are convinced t h a t the de- velopment of a t e c h n i c a l and p o l i t i c a l c a p a c i t y on the p a r t of "organized c a p i t a l i s t s " to enter i n t o mutually b i n d i n g s o c i a l c o n t r a c t s with "organized workers" has already become i n some c o u n t r i e s and w i l l become i n others a c e n t r a l feature of the p o l i c y process. Already p r e f i g u r e d i n the S o c i a l Peace Treaty and Saltsjobaden Agreement i n Switzerland and Sweden i n the l a t e "1930s, t h i s " l i b e r a l c o r p o r a t i s t " device f o r reaching and implementing p u b l i c p o l i c y has been widely recognized i n recent years as an emergent trend i n other advanced i n d u s t r i a l s o c i e t i e s . What has been l e s s c l e a r l y perceived i s t h a t such arrangements, however f o r m a l l y or i n f o r m a l l y s t r u c - tured, depend e v e n t u a l l y on the a c q u i s i t i o n of a s i m i l a r o r g a n i z a t i o n a l capacity and a u t h o r i t y by business a s s o c i a t i o n s and labor o r g a n i z a t i o n s . Since both the a b s t r a c t l o g i c of a s s o c i a b i l i t y and i t s concrete h i s t o r i c a l p r a c t i c e have been q u i t e d i f f e r e n t f o r the two c l a s s e s (not to mention even greater d i f f e r e n c e s with other p r o f e s s i o n s , s e c t o r s , i n t e r e s t s ) , t h i s poses an important o r g a n i z a t i o n a l dilemma — one which has a f f e c t e d West- ern European and North American p o l i t i c s i n q u i t e d i f f e r e n t ways. I t i s these d i f f e r e n c e s i n the o r g a n i z a t i o n a l s t r u c t u r e and s t r a t e g y of business i n t e r e s t a s s o c i a b i l i t y which provide the c e n t r a l focus f o r our proposed c o l l a b o r a t i v e research.
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1.2. EXISTING RESEARCH
The problematique sketched above has not gone unnoticed e i t h e r by s c h o l a r s working i n s e v e r a l academic d i s c i p l i n e s or by p r a c t i t i o n e r s seek- i n g p o l i c y s o l u t i o n s i n advanced i n d u s t r i a l s o c i e t i e s . One expression of t h i s i s the emergence s e v e r a l years ago of what has come to be c a l l e d "an i n f o r m a l , n o n s p a t i a l , unfunded working group on i n t e r e s t p o l i t i c s and policy-making i n h i g h l y i n d u s t r i a l i z e d , advanced c a p i t a l i s t s o c i e t i e s "
(Schmitter, 1977a; 3) — a group whose members, i n one way or another, have found i t u s e f u l to r e l a t e t h e i r work on i n t e r e s t a s s o c i a t i o n s and i n t e r e s t r e p r e s e n t a t i o n to the concepts of neo-,* l i b e r a l - or s o c i e t a l corporatism. Recently there has been an i n c r e a s i n g number o f books and a r t i c l e s on contemporary corporatism from authors who, i n d i f f e r e n t ways and with d i f f e r i n g i n t e n s i t y , have been p a r t i c i p a t i n g i n the d i s c u s s i o n s of t h i s group. Some of the r e s u l t s of group meetings j o i n t l y sponsored by - the I n t e r n a t i o n a l P o l i t i c a l Science A s s o c i a t i o n and the I n t e r n a t i o n a l S o c i o - l o g i c a l A s s o c i a t i o n are about to be published i n two successive volumes e d i t e d by P h i l i p p e C. Schmitter and Gerhard Lehmbruch (Schmitter and Lehm- bruch, 1979; Lehmbruch and Schmitter, 1980). The forthcoming c o l l e c t i o n of essays, "Organizing I n t e r e s t s i n Western Europe", e d i t e d by Suzanne Berger from papers presented to meetings of the S o c i a l Science Research C o u n c i l
(New York), Committee on Western Europe, w i l l a l s o bear d i r e c t l y on problems r a i s e d i n the debate on contemporary corporatism and i n v o l v e s s e v e r a l pro- spective c o l l a b o r a t o r s of the proposed p r o j e c t .
Among the c e n t r a l issues of the recent d i s c u s s i o n on corporatism i n developed i n d u s t r i a l s o c i e t i e s i s the problem of the "symmetry" of corpor- a t i s m . i n t e r e s t i n t e r m e d i a t i o n . The context i n which t h i s problem i s most evident i s t h a t of the c o r p o r a t i s t management of i n d u s t r i a l r e l a t i o n s i n
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general and o f "concerted" i n d u s t r i a l and incomes p o l i c i e s i n p a r t i c u l a r . According to a number o f d i s c u s s a n t s , the c o r p o r a t i s t i n t e r m e d i a t i o n o f group i n t e r e s t s means something fundamentally d i f f e r e n t f o r organized labor than f o r organized business. As f o r instance P a n i t c h (1978) has argued, while i t may be true t h a t the i n t e r e s t s o f labor are e f f e c t i v e l y transformed by n e o - c o r p o r a t i s t i n t e r e s t i n t e r m e d i a t i o n , the i n t e r e s t s o f c a p i t a l are not - and cannot be because the b a s i c s t r u c t u r a l p r o p e r t i e s of the c a p i t a l i s t system remain unchanged. Whatever i n t e r e s t s on the p a r t o f workers and t h e i r o r g a n i z a t i o n s neo-corporatism may serve, t h e r e f o r e , b a s i c a l l y i t has to be conceptualized as an arrangement to subject the i n t e r e s t s o f the working c l a s s to those o f c a p i t a l . In t h i s sense, s i n c e the n e o - c o r p o r a t i s t mode of p o l i t i c a l c o n t r o l i s a p p l i c a b l e only t o labor and has to leave out c a p i t a l , neo-corporatism, whatever e l s e i t may be, remains a fundamentally asymmetri- c a l p o l i t i c a l system. (For a more systematic d i s c u s s i o n of the "symmetry"
problem, see below, 1.3.3.)
Another v e r s i o n of the "asymmetry hypothesis" has been put forward
r e c e n t l y by Offe and Wiesenthal (1979). While Panitch concerns h i m s e l f with the r e s u l t s o f c o r p o r a t i s t c o n f l i c t r e g u l a t i o n on the s t a b i l i t y o f the c l a s s s t r u c t u r e , Offe and Wiesenthal d i s c u s s the problem i n terms of the o r g a n i z - a t i o n a l p r o p e r t i e s o f unions and business a s s o c i a t i o n s . According to O f f e and Wiesenthal, the o f t e n assumed analogy between the " i n t e r e s t a s s o c i a t i o n s "
of labor and c a p i t a l e x i s t s only s u p e r f i c i a l l y . In r e a l i t y , organized c o l - l e c t i v e a c t i o n means something fundamentally d i f f e r e n t f o r workers than f o r c a p i t a l owners. While workers t o be able to r e a l i z e t h e i r i n t e r e s t s are de- pendent on the formation o f a c o l l e c t i v e p o l i t i c a l w i l l , c a p i t a l owners are not; t h e i r p r e f e r r e d , and i n f a c t most e f f i c i e n t , way of a c t i o n i s to r e - spond i n d i v i d u a l l y to the c o n s t r a i n t s and o p p o r t u n i t i e s o f f e r e d by the market.
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As a r e s u l t , s i n c e c o l l e c t i v e o r g a n i z a t i o n i s much l e s s important f o r business than i t i s f o r l a b o r , the l e a d e r s h i p p o t e n t i a l of business as- s o c i a t i o n s i n r e l a t i o n t o t h e i r members, and the p o s s i b l e degree o f " p o l i t i - c i z a t i o n " of business i n t e r e s t s , i s f o r systematic reasons s i g n i f i c a n t l y lower than t h a t o f l a b o r unions. I f t h i s i s so, however, then the c a p a c i t y of business a s s o c i a t i o n s to become, i n the same way as trade unions, i n - s t i t u t i o n a l i z e d p a r t i c i p a n t s i n n e o - c o r p o r a t i s t systems of s o c i e t a l compro- mise and c o n t r o l i s s t r u c t u r a l l y l i m i t e d . The c o n c l u s i o n i s , again, t h a t n e o - c o r p o r a t i s t i n t e r e s t i n t e r m e d i a t i o n , t o the extent t h a t I t can a t a l l f u n c t i o n e f f e c t i v e l y , i s a b a s i c a l l y asymmetrical system: while on the labor s i d e the i n t e g r a t i o n and i n s t i t u t i o n a l i z a t i o n o f i n t e r e s t a s s o c i a t i o n s has a d i r e c t e f f e c t on'the d e f i n i t i o n o f c o l l e c t i v e and i n d i v i d u a l i n t e r e s t s
and i d e n t i t i e s , on the side o f c a p i t a l the same process i s o f only p e r i p h e r a l importance to the substance of the i n t e r e s t s pursued and to the r o l e and
status o f the members o f the r e s p e c t i v e a s s o c i a t i o n s i n s o c i e t y .
While i n i t i a l l y the problem of symmetry i n c o r p o r a t i s t systems has been discussed mainly i n t h e o r e t i c a l terms, there i s now an i n c r e a s i n g tend- ency to make i t the subject of e m p i r i c a l research. One major ongoing e f f o r t i n t h i s area i s t h a t by Gerhard Lehmbruch and others on the "quid p r o quo"
o f a s t a b l e l i b e r a l - c o r p o r a t i s t cooptation o f l a b o r , and on what Lehmbruch has termed the " n e o - c o r p o r a t i s t l o g i c of exchange" (see Lehmbruch, 1978).
The o b j e c t i v e o f t h i s study, which l i k e the one proposed here i s i n t e r - n a t i o n a l l y comparative, i s to determine what " p a y - o f f s " labor unions have demanded and r e c e i v e d i n exchange f o r cooperation i n t r i p a r t i t e i n d u s t r i a l and incomes p o l i c i e s ; how d i f f e r e n t p o l i c y . i s s u e s and s e c t o r s o f p o l i c y -
making are l i n k e d i n c o r p o r a t i s t "package d e a l s " to i n s u r e union cooperation;
which " t r a d e - o f f s " e x i s t between such i s s u e s and s e c t o r s ; and whether there
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i s a measurable r e l a t i o n s h i p between v o l u n t a r y wage r e s t r a i n t o f l a b o r unions on the one hand and c e r t a i n p u b l i c p o l i c y outputs (such as an a c t i v e labor market p o l i c y , a high l e v e l of p u b l i c t r a n s f e r payments, a f a v o r a b l e tax p o l i c y , etc.) on the other. The main achievement o f t h i s approach i s t h a t i t g i v e s the problem of "symmetry" an o p e r a t i o n a l formulation, thus making the c o n d i t i o n s of a s t a b l e n e o - c o r p o r a t i s t i n t e r e s t balance a matter o f em- p i r i c a l comparative research r a t h e r than of general s p e c u l a t i o n .
L i k e the p r o j e c t o f Lehmbruch and others, the research e f f o r t proposed here i s concerned with the "symmetry" o f c o r p o r a t i s t i n t e r e s t i n t e r m e d i a t i o n . However, while Lehmbruch and h i s c o l l a b o r a t o r s d i s c u s s the problem a t the
l e v e l o f substantive p o l i c y outcomes, the present p r o j e c t i s to i n v e s t i g a t e the o r g a n i z a t i o n a l s t r u c t u r e of business i n t e r e s t a s s o c i a t i o n s as i n t e r - mediary o r g a n i z a t i o n s i n p o t e n t i a l n e o - c o r p o r a t i s t p o l i c i e s . In t h i s , i t f o r one t h i n g represents an attempt to redress a p a r t i c u l a r asymmetry, not of i n t e r - est i n t e r m e d i a t i o n as such, but of the previous e m p i r i c a l and t h e o r e t i c a l r e - search: i t s preoccupation with o r g a n i z a t i o n s of labor and i t s corresponding
neglect o f the o r g a n i z a t i o n s of business. For another t h i n g , and on a sub- s t a n t i v e l e v e l , the p r o j e c t takes up, and t r i e s to e l a b o r a t e , some of the questions r a i s e d by Offe and Wiesenthal, attempting to d e a l with them em- p i r i c a l l y r a t h e r than i n an a b s t r a c t , t h e o r e t i c a l - d e d u c t i v e way. In f a c t ,
since Offe w i l l be one o f the d i r e c t o r s of the German case study, the p r o j e c t w i l l provide a r a r e opportunity f o r a c o l l a b o r a t i v e e x e r c i s e i n the t e s t i n g of c o n f l i c t i n g hypotheses. There w i l l a l s o be c l o s e contacts with the pro- j e c t of Lehmbruch and others which w i l l make i t p o s s i b l e to p l a c e the r e - search on o r g a n i z a t i o n a l p r o p e r t i e s and a c t i v i t i e s i n the context o f p o l i t i c a l issues and p o l i c i e s .
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1.3. THE THEORETICAL DOMAIN
The p r i n c i p a l t o p i c s of the p r o j e c t can be summarized i n three question (1) Why should the owners o f c a p i t a l , possessing as they are the d i s - c r e t i o n a r y power t o i n v e s t , develop a need f o r c o l l e c t i v e i n t e r e s t represent a t i o n , and what are the s o c i e t a l c o n d i t i o n s determining the s i g n i f i c a n c e o f c l a s s a s s o c i a t i o n s as instruments used by business i n the p u r s u i t o f i t s i n t e r e s t s ? ;
(2) What s t r u c t u r a l arrangements are r e q u i r e d , given the b a s i c a l l y i n - d i v i d u a l i s t i c - and competitive s t r u c t u r e of .business i n t e r e s t s , f o r owners of c a p i t a l t o be able t o a s s o c i a t e with each other and t o form c o l l e c t i v e i n t e r e s t o r g a n i z a t i o n s ? ;
(3) I s c o l l e c t i v e i n t e r e s t r e p r e s e n t a t i o n of employers subject t o the same d i a l e c t i c a l f o r c e s which have made workers o r g a n i z a t i o n s , o r i g i n a l l y s e t up s o l e l y to advance the i n t e r e s t s of t h e i r c o n s t i t u e n t s v i s - a - v i s other s o c i a l groups, subsequently assume governing p r o p e r t i e s i n r e l a t i o n to t h e i r members?
Each o f these questions, i n ways which w i l l be discussed below, r e f e r s t o what one can c a l l the o r g a n i z a t i o n a l dimension o f business i n t e r e s t p o l i t i c s and i t i s t o t h i s dimension t h a t the a t t e n t i o n of the p r o j e c t w i l l be p r i - m a r i l y d i r e c t e d .
1.3.1. THE POLITICAL IMPERATIVES FOR BUSINESS ASSOCIABILITY
In t h e o r e t i c a l terms, the f i r s t of the three questions examines the o r g a n i z a t i o n a l p r o p e r t i e s o f business a s s o c i a t i o n s from the p e r s p e c t i v e of some c e n t r a l problems i n p o l i t i c a l - e c o n o m i c theory. Theories of p o l i t i c a l economy attempt t o e x p l a i n the s t r u c t u r e and the f u n c t i o n i n g o f p o l i t i c a l systems by reference to "underlying" economic s t r u c t u r e s . While i n p r i n c i p l e
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the s u b j e c t of p o l i t i c a l - e c o n o m i c theory i s the r e l a t i o n s h i p between econ- omic and p o l i t i c a l a c t i o n i n g e n e r a l , most of the debate tends to focus on the r e l a t i o n s between C a p i t a l and the State i n Western i n d u s t r i a l i z e d count- r i e s , or, more s p e c i f i c a l l y , between p r i v a t e ownership of the means of pro- d u c t i o n and p u b l i c c o n t r o l over the means of domination.. In p a r t i c u l a r , the d i s c u s s i o n centers on whether and how i n Western democracies the d i s t r i b u t i o n of economic power, and the c l a s s s t r u c t u r e r e s u l t i n g from i t , r e f l e c t on the d i s t r i b u t i o n and the f u n c t i o n s of p o l i t i c a l power, and to what extent the p r i n c i p l e s of equal c i t i z e n s h i p embodied i n a democratic p o l i t i c a l con- s t i t u t i o n can c o e x i s t with, or even i n i t i a t e changes i n , the system of econ- omic i n e q u a l i t y . One hypothesis f r e q u e n t l y put forward i n t h i s context i s that the economic d e c i s i o n s of p r i v a t e c a p i t a l owners, e s p e c i a l l y with r e - gard to investment, p l a c e such heavy r e s t r i c t i o n s on the p o s s i b l e range of government p o l i c i e s that c a p i t a l owners can a f f o r d to concede formal auton- omy to the s t a t e , and to t o l e r a t e p o l i t i c a l democracy f o r the working c l a s s , without having to f e a r t h a t t h e i r i n t e r e s t s w i l l be s e r i o u s l y p r e j u d i c e d . Since p r i v a t e c a p i t a l owners c o n t r o l the s o c i e t y ' s means of production and thus possess the r e l e v a n t economic power, they are able, according to the theory, to advance and p r o t e c t t h e i r i n t e r e s t s a g a i n s t p o l i t i c a l i n f r i n g e - ment without s p e c i f i c a l l y having to acquire p o l i t i c a l power. Although c a p i t a l owners may sometimes f i n d i t more convenient (and c e r t a i n l y more pleasant) to d e a l with governments and p a r t i e s d e l i b e r a t e l y and o v e r t l y sympathetic to t h e i r i d e o l o g i c a l views, t h e i r i n f l u e n c e on the p o l i t y i s assumed to r e s t , not on p o l i t i c a l m o b i l i z a t i o n , but on the f a c t t h a t t h e i r n o n - p o l i t i c a l ,
"economically r a t i o n a l " , behavior i n the market c o n s t i t u t e s one of the most fundamental c o n d i t i o n s f o r the success of a l l p u b l i c p o l i c i e s i n such so- c i e t i e s . Any government, which f a i l s to take t h i s c o n s t r a i n t i n t o account and which takes measures adversely a f f e c t i n g the w i l l i n g n e s s of c a p i t a l owners
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to i n v e s t i s bound t o create economic disturbances which not only destroy the economic base o f s t a t e a c t i v i t i e s but a l s o tend to erode the govern- ment's p o l i t i c a l support. Hence, according to the argument, s t a t e p o l i c i e s tend to be geared to the i n t e r e s t s o f c a p i t a l owners even i f the government happens to be i n the hands o f non- or a n t i - b u s i n e s s o r i e n t e d parties-.
One of the advantages o f t h i s approach - which one can b r i e f l y r e f e r to as the " b u s i n e s s - i n t e r e s t s - a s - f u n c t i o n a l - c o n s t r a i n t s " theory - i s t h a t i t y i e l d s c l e a r hypotheses on the s t a t u s and the character o f business i n t e r e s t a s s o c i a t i o n s . I f c a p i t a l owners as a c l a s s are b a s i c a l l y able to promote t h e i r i n t e r e s t s without e n t e r i n g the p o l i t i c a l arena d i r e c t l y , t h e i r c o l l e c - t i v e a s s o c i a t i o n s are e x c l u s i v e l y economic phenomena emerging i n p r i n c i p l e from.the inherent s t r a t e g i c imperatives o f m a r k e t - r a t i o n a l behavior. T h i s , i n t u r n , i m p l i e s t h a t they have no r o l e i n the i n t e r p r e t a t i o n and d e f i n i t i o n of t h e i r members' s t r u c t u r a l i n t e r e s t s , and t h a t they t h e r e f o r e are i n p r i n - c i p l e of only secondary importance from the viewpoint of t h e i r members.
While i t may be r a t i o n a l f o r business i n t e r e s t s to organize and form a s s o c i - a t i o n s , the c r i t e r i a of such r a t i o n a l i t y are i n no way d i f f e r e n t from those governing behavior i n the market, and are i n p a r t i c u l a r not a f f e c t e d by the f a c t and process o f associa'-bility as such.In t h i s sense, business a s s o c i a - t i o n s are h e l d to be incomparable to p o l i t i c a l o r g a n i z a t i o n s f o r which the transformation of i n d i v i d u a l i n t e r e s t perceptions i n t o a common i n t e r e s t d e f i n i t i o n - the formation, as i t were, o f a c o l l e c t i v e p o l i t i c a l i d e n t i t y - i s of c e n t r a l importance.
On the other hand, i t could be argued t h a t the " f u n c t i o n a l c o n s t r a i n t s "
hypothesis, and i t s implied assumption that business i n order to e x e r c i s e p o l i t i c a l c o n t r o l does not have t o develop a c o l l e c t i v e p o l i t i c a l w i l l , i s based on a m i s i n t e r p r e t a t i o n of a r e l a t i v e l y recent h i s t o r i c a l experience - on the observation t h a t i n many Western s o c i e t i e s business has been able to
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accomodate i t s e l f r e l a t i v e l y e a s i l y to Social-Democratic governments, and that the l a t t e r have g e n e r a l l y been hardly l e s s responsive to business i n t e r e s t s than conservative governments. However, while there can be no doubt t h a t . t h i s i s i n f a c t the case, concluding from i t t h a t c a p i t a l owners do not. have t o p o l i t i c i z e t h e i r i n t e r e s t s to impose them upon the p o l i t i c a l system i s based on an i d e n t i f i c a t i o n of p o l i t i c a l a c t i o n with p a r t i c i p a t i o n i n the i n s t i t u t i o n a l i z e d system of p a r t i s a n - t e r r i t o r i a l r e p r e s e n t a t i o n . This i d e n t i f i c a t i o n , however, has been i n c r e a s i n g l y challenged i n recent years. "As has been pointed out from a number of d i f f e r e n t p e r s p e c t i v e s , l i b -
eral-democratic s t a t e s i n developed i n d u s t r i a l s o c i e t i e s r e l y f o r the t r a n s - mission of power and i n f l u e n c e i n t o t h e i r p o l i t i c a l process to an important
extent on d i r e c t f u n c t i o n a l r e p r e s e n t a t i o n by a s s o c i a t i o n s whose membership i s based on f u n c t i o n a l l y s p e c i a l i z e d i n t e r e s t c a t e g o r i e s . To the extent that f u n c t i o n a l r e p r e s e n t a t i o n i n t h i s sense i s an autonomous, systematic element of the p o l i t i c a l process, i n t e r e s t a s s o c i a t i o n s and the i n t e r e s t s they represent are not j u s t p a r t of " c i v i l s o c i e t y " but assume a b a s i c a l l y p u b l i c , p o l i t i c a l s t a t u s . Thus, although i t may be true t h a t the i n t e r e s t s of business r a r e l y r e q u i r e e x p l i c i t p o l i t i c i z a t i o n i n terms of t e r r i t o r i a l l y - based r e p r e s e n t a t i o n , e l e c t o r a l competition and majority government, t h i s may not hold i n the same way f o r the system of f u n c t i o n a l r e p r e s e n t a t i o n . While business i n t e r e s t s may be b a s i c a l l y compatible under normal circum- stances with a l l l i k e l y outcomes of the e l e c t o r a l process, t h i s may w e l l be the r e s u l t of s u c c e s s f u l p o l i t i c a l i n t e g r a t i o n through f u n c t i o n a l l y - b a s e d
i n t e r e s t intermediation. Thus, the f a c t t h a t c a p i t a l i s m has. been able by and large to c o e x i s t with s o c i a l democracy may not n e c e s s a r i l y be due to the, so to speak, p r e - p o l i t i c a l c o n s t r a i n t s imposed upon the p o s s i b l e range of state p o l i c i e s by p r i v a t e c o n t r o l over investment, but could a l s o be, the r e s u l t of a " h i s t o r i c a l compromise" between the s t a t e , the labor movement
14
and business as a c o l l e c t i v e p o l i t i c a l a c t o r represented by i t s i n t e r e s t a s s o c i a t i o n s .
The question whether or not, and to what extent, business a s s o c i a t i o n s are i n the above sense p o l i t i c a l phenomena, i s of c e n t r a l conceptual and em- p i r i c a l s i g n i f i c a n c e . C o l l e c t i v e p o l i t i c a l a c t i o n and -economic a c t i o n i n the market p l a c e are guided by fundamentally d i f f e r e n t p r i n c i p l e s and s t r a t e g i c imperatives. S o c i a l groups i n order to become p o l i t i c a l a c t o r s r e q u i r e , among other things, a minimal degree of i n t e r n a l cohesion, a sense o f s o l i - d a r i t y i n s p i t e of e x i s t i n g i n t e r n a l d i v i s i o n s , and l e g i t i m a t e l e a d e r s h i p strong enough to impose d i s c i p l i n e and i n d i v i d u a l s a c r i f i c e on t h e i r members.
A l s o , to e x e r c i s e i n f l u e n c e w i t h i n the i n s t i t u t i o n a l framework o f democratic p o l i t i c a l systems, c o l l e c t i v e a c t o r s have to be able to formulate t h e i r goals i n terms of commonly accepted values - the " p u b l i c i n t e r e s t " - and to make t h e i r p o s i t i o n appear as a s y m b o l i c a l l y d e f i n e d s o c i a l s t a t u s embodying c e r t a i n l e g i t i m a t e r i g h t s and e n t i t l e m e n t s . Whether or not a group i s s u c c e s s f u l
as a p o l i t i c a l a c t o r depends i n p r i n c i p l e on i t s a b i l i t y to solve these and s i m i l a r problems of p o l i t i c a l m o b i l i z a t i o n . As t h i s a p p l i e s to them i n the same way as to a l l other s o c i a l groups, employers or entrepreneurs when they adopt a p o l i t i c a l mode o f .action are i n a fundamentally d i f f e r e n t p o s i t i o n than they are i n the market p l a c e : while i n the l a t t e r they are d i s t i n g u i s h e d from a l l other actors by t h e i r unique power to c o n t r o l investment, the l o g i c p r e v a i l i n g i n a p o l i t i c a l frame of a c t i o n puts them a t l e a s t i n p r i n c i p l e on the same p l a i n as t h e i r opponents. The c r u c i a l d i f f e r e n c e , i n other words, from the viewpoint-of c a p i t a l owners between the p o l i t i c a l and the economic domain i s t h a t i n the former they have to meet other groups on terms which, u n l i k e the terms r e g u l a t i n g economic exchange i n the market p l a c e , do not grant them an a p r i o r i advantage. For t h i s reason, p o l i t i c a l a c t i o n f o r
business can be assumed to c o n s t i t u t e a "second choice" which, since i t does not
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grant c a p i t a l owners s i m i l a r "competitive advantages" as does economic'action i n the market p l a c e , i n v o l v e s c o n s i d e r a b l e r i s k s and U n c e r t a i n t i e s . T h i s im-
p l i e s , i n turn, t h a t the degree to which business i n t e r e s t a s s o c i a t i o n s be- come " p o l i t i c i z e d " i s determined by the extent t o which, f o r whatever reasons, the power t o i n v e s t i s not, or no longer, s u f f i c i e n t f o r them t o c o n t r o l the p o l i t i c a l process and t o r e a l i z e t h e i r economic i n t e r e s t s . The p o l i t i c a l character o f business i n t e r e s t a s s o c i a t i o n s i s i n t h i s sense dependent upon the e x i s t e n c e o f s o c i e t a l c o n d i t i o n s i n which a n o n - p o l i t i c a l , i n d i v i d u a l , market-oriented way f o r c a p i t a l owners to pursue t h e i r i n t e r e s t s does not l e a d to s a t i s f a c t o r y r e s u l t s — f o r them and. for" s i g n i f i c a n t " p u b l i e s " . I t i s o n l y under the pressure of such circumstances t h a t business, i n c o n t r a d i c t i o n to what i s assumed by the " f u n c t i o n a l c o n s t r a i n t s " theory, i s w i l l i n g to enter d i r e c t l y i n t o the p o l i t i c a l arena i n s t e a d o f l i m i t i n g i t s e l f to determining i t s pay-off matrix, so-to-speak, i n d i r e c t l y from without.
There may b a s i c a l l y be three reasons by which entrepreneurs or employers may be f o r c e d to p o l i t i c i z e t h e i r i n t e r e s t s and t o form c l a s s o r s e c t o r a l a s s o c i a t i o n s . F i r s t , while f r e e competition i s a b a s i c f e a t u r e o f the c a p i t a l - i s t mode o f production, c a p i t a l owners i n pursuing t h e i r i n d i v i d u a l i n t e r e s t s do not b r i n g about the spontaneous i n t e g r a t i o n o f the system but, to the con- t r a r y , generate systemic c o n t r a d i c t i o n s and c r i s e s . Thus, even i n h i s t o r i a l s i t u a t i o n s i n which they, as a c l a s s , enjoyed great advantages over workers, p r e - i n d u s t r i a l estates and consumers, one can witness a v a r i e t y o f attempts to coordinate, by means o f a network o f a s s o c i a t i o n s , i n d i v i d u a l and s e c t o r a l i n t e r e s t s i n order t o preserve the v i a b i l i t y o f the system as a whole. B a s i c , issues i n t h i s stage o f a s s o c i a t i o n a l a c t i v i t y were attempts t o avoid c u t -
throat p r i c e competition on the market; e f f o r t s t o l i m i t or prevent a l t o - gether the access of f o r e i g n competitors t o the domestic market; endeavours to form a common f r o n t v i s - a - v i s the s e l l e r s o f b a s i c raw m a t e r i a l s and
16
other s u p p l i e s , and the l i k e .
A second reason f o r c a p i t a l owners to organize i s t h a t t h e i r power to i n v e s t i s , or a t l e a s t could be, challenged by the p o l i t i c a l m o b i l i z a t i o n . of workers. In s e v e r a l h i s t o r i c a l instances,- business e f f o r t s to
organize and coordinate i t s a c t i o n s came as a response to p r i o r attempts by workers to defend t h e i r i n t e r e s t s through c o l l e c t i v e a c t i o n . The i n s t i t u t i o n ' a l i z a t i o n of c l a s s c o n f l i c t , the s e t t i n g of shared, r u l e s o f the game i n l a b o r d i s p u t e s , the e f f o r t to guarantee a s t a b l e and r e l i a b l e l a b o r supply, have i n c r e a s i n g l y become major concerns of business a s s o c i a t i o n s ; and trade unions have become t h e i r most important i n s t i t u t i o n a l p a r t n e r s .
T h i r d l y , with the i n c r e a s i n g l y systematic i n t e r v e n t i o n of the s t a t e i n t o the economy, the importance of the market as a mechanism of resource a l l o c a - t i o n has d e c l i n e d while the importance o f the p o l i t y has p r o p o r t i o n a t e l y i n - creased. One, but not the only, reason f o r t h i s i s democratization.
As p o l i t i c a l democracy operates on the p r i n c i p l e of "one man - one v o t e " , i t has an inherent tendency to produce i n t e r v e n t i o n i s t p o l i c i e s aimed a t econ- omic r e d i s t r i b u t i o n . D i r e c t l y or i n d i r e c t l y , such p o l i c i e s may touch upon the "sovereignty" o f p r i v a t e c a p i t a l owners with regard to investment.
Business i n t e r e s t a s s o c i a t i o n s have always seen i t as one of t h e i r foremost tasks to fend o f f p o l i t i c a l a t t a c k s upon the freedom to i n v e s t and to con-
" i r r a t i o n a l "
t a i n t h e / r e d i s t r i b u t o r y tendencies emanating from p o l i t i c a l democracy. On the other hand, c o l l e c t i v e i n t e r e s t a s s o c i a t i o n s are i n a b e t t e r p o s i t i o n than i n d i v i d u a l entrepreneurs to a p p r e c i a t e the minimum of p o l i t i c a l l y mediated r e d i s t r i b u t i o n necessary to maintain the l e g i t i m a c y of the s o c i a l system as a whole. In c e r t a i n circumstances, they may even come to the con- c l u s i o n that the p r e s e r v a t i o n of the system and the p r o t e c t i o n of the long- run i n t e r e s t s of t h e i r membership r e q u i r e t h a t they enforce t h i s minimum
17
upon r e l u c t a n t or r e s i s t i n g i n d i v i d u a l members. In t h i s sense, the more economic processes are mediated, f a c i l i t a t e d and r e g u l a t e d through democratic p o l i t i c a l i n s t i t u t i o n s , the more business as a whole, or s e c t o r s of i t , are drawn i n t o the p o l i t i c a l game and f o r c e d to develop a c a p a c i t y f o r c o l l e c t i v e a c t i o n . As a r e s u l t and i n response to the d e m o c r a t i c . p o l i t i c i z a t i o n of so-
c i a l and economic exchanges, business i n t e r e s t s may have to become p o l i t i - c i z e d themselves - i . e . , may become subject to c o l l e c t i v e d e f i n i t i o n and r e d e f i n i t i o n w i t h i n the i n s t i t u t i o n a l i z e d process of i n t e r e s t r e p r e s e n t a t i o n and i n t e r m e d i a t i o n .
An important problem which w i l l have to be f u r t h e r c l a r i f i e d i n the course of the p r o j e c t i s the r e l a t i o n s h i p of organized i n t e r e s t p o l i t i c s to other forms of c o l l e c t i v e a c t i o n of business such as c a r t e l s , t r u s t s and t r a n s n a t i o n a l c o r p o r a t i o n s . To an extent, the c o o r d i n a t i o n of business s t r a t e g i e s through i n t e r e s t a s s o c i a t i o n s and through economic c o n c e n t r a t i o n seems' to b e " f u n c t i o n a l l y e q u i v a l e n t . One b a s i c research question, t h e r e f o r e , w i l l have to be under what c o n d i t i o n s and f o r what s p e c i f i c purposes c a p i t a l owners p r e f e r one or another means of c o o r d i n a t i o n . . H i s t o r i c a l l y , c a r t e l s and t r u s t s have been a major way to organize important segments of the market and to c o n t r o l c o n t r a d i c t i o n s and c r i s e s generated by the 'anarchy of f r e e -j.
The authors owe t h i s p o i n t to Manfred Groser. Groser suggests t h a t p o l i t - i c a l systems i n which the l i m i t s of r e d i s t r i b u t i o n are determined by the • l o g i c of p r i v a t e investment d e c i s i o n s are subject to c r i t i c a l f r i c t i o n s . The i n d i v i d u a l c a p i t a l owner, however, has n e i t h e r the information nor the macro-economic or m a c r o - p o l i t i c a l p e r s p e c t i v e to assess the p o s i t i v e con-
sequences of a l i m i t e d degree of r e d i s t r i b u t i o n f o r h i m s e l f . The r e s u l t i s that he, as a r u l e , i s opposed to any r e d i s t r i b u t i o n whatsoever. But even i f he i s not — - f o r reasons of enlightened s e l f i n t e r e s t , paternalism or a l t r u i s m - he, at l e a s t , wants to be sure that a l l other c a p i t a l owners, and i n p a r t i c u l a r h i s competitors, a l s o c o n t r i b u t e t h e i r share. ' T h i s r e - quires that the support of r e d i s t r i b u t o r y p o l i c i e s becomes a matter of c o l - l e c t i v e r a t h e r than i n d i v i d u a l a c t i o n . Thus, i n c e r t a i n instances the amount of r e d i s t r i b u t i o n necessary to s t a b i l i z e the p o l i t i c a l (and the s o c i a l ) sys- tem comes about only when the i n t e r e s t s of i n d i v i d u a l c a p i t a l owners are mediated one way or another through a s s o c i a t i o n a l c o n t r o l s t r u c t u r e s .
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competition'. A l s o , c a r t e l s and t r u s t s have proved to be much b e t t e r equipped than i n d i v i d u a l firms t o d e a l with the challenge posed by the p o l i t i c a l r e p r e s e n t a t i o n o f the i n t e r e s t s o f workers. F i n a l l y , they have enjoyed a much greater b a r g a i n i n g power with the s t a t e than i n d i v i d u a l f i r m s through the e x e r c i s e of t h e i r power t o i n v e s t .
On the other hand, one could argue t h a t economic c o n c e n t r a t i o n , by l e a d - i n g to the emergence of a small number o f powerful f i n a n c i a l - i n d u s t r i a l groups, f o s t e r e d more, a l b e i t d i f f e r e n t , c o n f l i c t s and c o n t r a d i c t i o n s than i t solved. Thus, the d i s t o r t i o n of f r e e competition gave r i s e to economic c r i s e s which i n v i t e d s t a t e i n t e r v e n t i o n i n t o the economy and, a t l e a s t i n some c o u n t r i e s , r e s u l t e d i n l a s t i n g inroads i n t o the p r i v a t e power to i n v e s t
(the assumption by'the s t a t e of the r o l e s of r e g u l a t o r o f the business c y c l e or, even, of entrepreneur). A l s o , the p o l i t i c a l i n f l u e n c e which c a r t e l s and t r u s t s enjoyed vis-à-vis the s t a t e brought about a c l o s e i d e n t i f i c a t i o n between s t a t e and c a p i t a l which tended t o transform economic competition among business groups i n t o p o l i t i c a l - m i l i t a r y c o n f l i c t among n a t i o n - s t a t e s and thus to destroy the i n t e r n a t i o n a l market. And f i n a l l y , the market l o g i c of c a r t e l s and t r u s t s i n i n d u s t r i a l r e l a t i o n s was, a t l e a s t to a c e r t a i n degree, incapable of handling the d i f f e r e n t l o g i c o f c o l l e c t i v e a c t i o n o f labor unions. Contemporary t r a n s n a t i o n a l c o r p o r a t i o n s are a more s o p h i s t i - cated v e r s i o n of c a r t e l s and t r u s t s and a more, e f f i c i e n t i n s t i t u t i o n a l a r - rangement i n d e a l i n g with the c o n t r a d i c t i o n s of an i n t e g r a t e d i n t e r n a t i o n a l market economy. T r a n s n a t i o n a l c o r p o r a t i o n s permit e f f i c i e n t planning on an i n t e r n a t i o n a l l e v e l , keep trade unions i n check by o r g a n i z i n g production i n a number of d i f f e r e n t c o u n t r i e s through a t i g h t l y coordinated and d i v e r s i - f i e d work process, and have a strong bargaining p o s i t i o n vis-à-vis n a t i o n a l governments. Yet, although more e f f e c t i v e than t h e i r h i s t o r i c a l predecessors,
a l s o
i t seems t h a t they a r e / s t r u c t u r a l l y unable to cope with the p o l i t i c a l prob-
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lems o f system i n t e g r a t i o n and to respond t o the need f o r some amount o f p o l i t i c a l l y mediated r e d i s t r i b u t i o n .
These c o n s i d e r a t i o n s bear d i r e c t l y upon the conceptual d i s t i n c t i o n be-:-- tween economic a n d . p o l i t i c a l a c t i o n . While a t the f i r s t glance i t may ap- pear obvious to view economic c o n c e n t r a t i o n as a marketerelated, and c o l l e c - t i v e o r g a n i z a t i o n as a p o l i t i c a l s t r a t e g y , i n r e a l i t y the d i f f e r e n c e may be much l e s s unambiguous. Although the formation of t r u s t s and t r a n s n a t i o n a l c o r p o r a t i o n s u s u a l l y i n v o l v e s the s e l l i n g o f ownership r i g h t s a t market p r i c e s , i t may sometimes be j u s t another form o f c o l l e c t i v e o r g a n i z a t i o n aimed a t the c o o r d i n a t i o n of business s t r a t e g i e s i n r e l a t i o n to the s t a t e , organized l a b o r , s u p p l i e r i n d u s t r i e s , customers, e t c . One p o s s i b l e way o f d i s t i n g u i s h i n g between economic and p o l i t i c a l a c t i o n may be to d e f i n e econ- omic a c t i o n as a "number reducing", and p o l i t i c a l a c t i o n as a "number-increas- ing" s t r a t e g y . While economic a c t o r s a t l e a s t i n p r i n c i p l e aim a t t o t a l c o n t r o l of the market and t h e r e f o r e s t r i v e to e l i m i n a t e t h e i r competitors, p o l i t i c a l a c t o r s , using p o l i t i c a l m o b i l i z a t i o n rather than money as t h e i r b a s i c resource, aim a t i n c r e a s i n g the number of those supporting i d e n t i c a l c o l l e c t i v e purposes. C a r t e l s , t r u s t s , t r a n s n a t i o n a l corporations are a l l forms of a s s o c i a t i o n which s e t b a r r i e r s to entry i n t o the market, whereas i n t e r e s t a s s o c i a t i o n s s t r i v e to e n l i s t l a r g e numbers of members i n order to increase t h e i r representativeness and l e g i t i m a t i o n i n f r o n t of t h e i r con- s t i t u e n c i e s and t h e i r i n s t i t u t i o n a l p a r t n e r s . One of the advantages of t h i s d i s t i n c t i o n i s t h a t i t r e l a t e s d i r e c t l y to the d i s c u s s i o n of the d i v e r s i t y of i n t e r e s t s among members of business a s s o c i a t i o n s and the management o f t h i s d i v e r s i t y through o r g a n i z a t i o n a l arrangements (see below, 1.3.2.)..
In any case, while the preceding argument may e x p l a i n why c o l l e c t i v e a s s o c i a t i o n s have been, and s t i l l are, important instruments f o r business i n pursuing i t s i n t e r e s t s , the question o f the c o n d i t i o n s under which i n t e r e s t -
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• p o l i t i c a l c o o r d i n a t i o n i s p r e f e r r e d over economic c o o r d i n a t i o n s t i l l remains open. As a f i r s t hypothesis one could suggest t h a t c a p i t a l owners p r e f e r economic c o o r d i n a t i o n when d e a l i n g with problems of demand f o r t h e i r products, and i n t e r e s t - p o l i t i c a l c o o r d i n a t i o n when faced with problems of the supply of b a s i c f a c t o r s of production. The reason could be t h a t on the demand s i d e c a p i t a l owners are confronted with partners - the consumers - who b a s i c a l l y accept a market l o g i c of a c t i o n and who, l i k e themselves, pursue ways of economic maximization of comparative advantages. As a r e s u l t , a c t i o n remains w i t h i n the market framework i n which the most obvious way f o r c a p i t a l owners to improve t h e i r p o s i t i o n i s through economic i n t e g r a t i o n and c o n c e n t r a t i o n . In the procurement of b a s i c resources, on the other hand, c a p i t a l owners are faced with partners - e.g. the workers and t h e i r unions, the o i l - p r o - ducing c o u n t r i e s , the s t a t e as the guarantor o f s o c i a l order - who fequent- l y do not l i m i t themselves to maximizing q u a n t i t a t i v e goals but who may a l s o behave according to a p o l i t i c a l " l o g i c of c o l l e c t i v e a c t i o n which i s geared to the p u r s u i t of q u a l i t a t i v e goals and f o r which the formation of c o l l e c t i v e i d e n t i t i e s i s p a r t i c u l a r l y important. In t h i s sense, the nature of the partners i n v o l v e d i n coordinated a c t i o n , and the p a r t i c u l a r type of i n t e r o r g a n i z a t i o n a l r e l a t i o n s r e q u i r e d , may help to e x p l a i n the s p e c i f i c forms of a s s o c i a t i o n , and the degree of p o l i t i c i z a t i o n of the means used f o r the c o o r d i n a t i o n of the i n d i v i d u a l i n t e r e s t s of c a p i t a l owners.
The extent to which business groups pursue t h e i r i n t e r e s t s through p o l i t i c a l a c t i o n rather than r e l y i n g s o l e l y on t h e i r power to i n v e s t can be determined by looking a t the o r g a n i z a t i o n a l s t r u c t u r e of t h e i r a s s o c i a t i o n s . The p o l i t i c a l a c t i o n o f s o c i a l c l a s s e s and economic s e c t o r s i s , almost by d e f i n i t i o n i n the modern p e r i o d , organized a c t i o n . I t .is p r i m a r i l y through the process of d e l i b e r a t e and permanent o r g a n i z a t i o n t h a t the s p e c i f i c im-
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p e r a t i v e s of the p o l i t i c a l domain enter i n t o the s o c i a l r e l a t i o n s of a c o l - l e c t i v i t y . T h i s i s why the dynamics o f i n t e r e s t p o l i t i c s express themselves i n terms o f o r g a n i z a t i o n a l and i n t e r o r g a n i z a t i o n a l dynamics. Analyzing the o r g a n i z a t i o n a l p r o p e r t i e s of i n t e r e s t a s s o c i a t i o n s , t h e r e f o r e , and r e l a t i n g them to the s t r u c t u r a l c o n d i t i o n s e x i s t i n g i n the s o c i e t y - a t - l a r g e may 'yield important i n s i g h t s i n t o the dynamics o f p o l i t i c i z a t i o n of s o c i a l i n t e r e s t s and i n t o the way s o c i a l s t r u c t u r e s , economic resources and p o l i t i c a l pro- cesses i n f l u e n c e each other. Since the s t r u c t u r e of i n t e r e s t a s s o c i a t i o n s i s a product of the i n t e r a c t i o n between the i n d i v i d u a l and the c o l l e c t i v e i n t e r e s t s o f the r e s p e c t i v e groups under s p e c i f i c c o n s t e l l a t i o n s o f s o c i e t a l f o r c e s , i t can serve as an i n d i c a t o r both o f the nature o f t h i s c o n s t e l l a t i o n of f o r c e s , and of i t s impact on the substantive content o f the i n t e r e s t s concerned. Thus, by looking over time a t changes i n the f u n c t i o n s business a s s o c i a t i o n s perform f o r t h e i r members, one can determine the areas and sec- tors i n which an i n d i v i d u a l i s t i c p u r s u i t of i n t e r e s t s i s or has become l e s s l i k e l y to p r e v a i l , and i n which the freedom to i n v e s t no longer works as a r e s t r i c t i v e enough c o n d i t i o n to make p u b l i c p o l i c y conform q u a s i - a u t o m a t i c a l l y to the i n t e r e s t s of p r i v a t e owners of c a p i t a l . A l s o , to the extent t h a t
business a s s o c i a t i o n s i n d i f f e r e n t s o c i a l environments and n a t i o n - s t a t e s d i f f e r i n t h e i r f u n c t i o n a l s i g n i f i c a n c e f o r t h e i r members, o r g a n i z a t i o n a l a n a l y s i s can c o n t r i b u t e to determining the c o n d i t i o n s under which the c o l - l e c t i v e i n t e r e s t s of employers and entrepreneurs gain i n importance as com- pared to those d e f i n e d more t r a d i t i o n a l l y i n i n d i v i d u a l , p u r e l y economic, terms. By comparing the o r g a n i z a t i o n a l strength of business a s s o c i a t i o n s i n r e l a t i o n to t h e i r s o c i a l base i n d i f f e r e n t c o u n t r i e s , i n d u s t r i a l sectors and h i s t o r i c a l periods, one can a r r i v e a t g e n e r a l i z a b l e p r o p o s i t i o n s on the changing r o l e of the p o l i t i c a l system i n advanced i n d u s t r i a l s o c i e t i e s , on the varying s t r u c t u r a l and h i s t o r i c a l sources of s o c i e t a l p o l i t i c i z a t i o n ,
