The pursuit of growth. Growth regimes, growth strategies and welfare reforms in advanced capitalist economies

In this article, we develop an analytical framework to study howeconomies and welfare systems have been adapted to the common challenges ofpost-industrialization, financialization, and the knowledge economy. We show that,despite the global interconnectedness of modern economies, national trajectories ofgrowth and policy-making remain distinct. Our explanation focuses on the pursuit ofdifferent growth strategies in contemporary advanced capitalist economies. Growthstrategies are in large parts welfare reforms. Governments use the policy tools ofthe welfare state such as employment policy, housing policy, pensions, minimumwages and education as facilitators for growth. They pursue them in different waysdepending on the growth regime their economies are embedded in. The articlesstarts with an overview of two key concepts used to build our argument: i) thecomplementary relationship between national growth and welfare regimes and ii)growth strategies through which growth and welfare regimes are reformed in thenew era of globalization, ICT and financialization driven growth. It then providesan overview of five main ideal-typical growth regimes that have developed inadvanced capitalist economies: the dynamic services export-led growth regime, thehigh-quality manufacturing export-led, the FDI-financed export-led, the financebaseddomestic demand-led and the public-financed domestic demand-led ones.Finally, it analyses the ties between growth strategies and welfare reforms and thusidentifies five main types of welfare state reforms strategies: dualization of welfare,social investment, fiscal and social attractiveness, commodification of welfare, andsocial protectionism. Within the Eurozone, because of external pressure, the latterstrategy has been transformed into a «competitive impoverishment» strategy forSouthern European countries.