The Diversity of Modern Capitalism

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Abstract
Capitalist economies have developed with a fair amount of diversity among themselves, which should have resulted in dramatic differences in levels of development. The fact that these differences are for the most part not noticeable may indicate that capitalism is based on such robust mechanisms that it accommodates varied institutional environments. In other words, institutional differences would be akin to national folklore, with few if any consequences for economic dynamics. If institutional specificities did have an effect, competition among nations would sooner or later lead to the adoption of international ‘best practices’. This book challenges these views on several counts. There are some elements of truth in the statement that differences in macroeconomic policy mix could explain in part the differences in economic performance. But this does not amount to saying that institutional specificities do not matter in explaining important differences in the basic economic mechanisms of the different countries. There is a considerable amount of theoretical and historical work that insists on the central role of institutions in economic dynamics.