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71. Representative versus Responsible Government

Author:
Peter Mair
Publication Date:
09-2009
Content Type:
Working Paper
Institution:
Max Planck Institute for the Study of Societies
Abstract:
The changing circumstances in which parties compete in contemporary democracies, coupled with the changing circumstances in which governments now govern, have led to a widening of the traditional gap between representative and responsible government. Although it is generally seen as desirable that parties in government are both representative and responsible, these two characteristics are now becoming increasingly incompatible. Prudence and consistency in government, as well as accountability, require conformity to external constraints and legacies. This means more than just answering to public opinion. While these external constraints and legacies have become weightier in recent years, public opinion, in its turn, has become harder and harder for governments to read. Hence we see the growing incompatibility. Meanwhile, because of changes in their organizations and in their relationship with civil society, parties are no longer in a position to bridge or “manage” this gap, or even to persuade voters to accept it as a necessary element in political life. This growing incompatibility is one of the principal sources of the democratic malaise that confronts many Western democracies today.
Topic:
Democratization, Government, Politics, and Governance

72. Market Constitution Analysis: A New Framework Applied to Solar Power Technology Markets

Author:
Guido Möllering
Publication Date:
07-2009
Content Type:
Working Paper
Institution:
Max Planck Institute for the Study of Societies
Abstract:
This paper outlines an integrative framework for the analysis of market constitution and explores its application to solar power technology markets. These markets are currently still in the making and, therefore, particularly suited to studying constitutive processes and the elements that play a role in them. In applying the framework to the constitution of solar power technology markets in Germany from the mid-1990s, the paper focuses on three examples of how constitutive mechanisms that trigger and drive market constitution processes and shape the constitutive elements of markets operate in distinct but interrelated ways: exploitation of technical inventions, business diversification, and political entrepreneurship. The analysis shows the role of market actors in “making” a market at the same time as these actors evidently become “marketized” by adopting market logic. Markets cannot be taken for granted in the field of solar power technologies or, rather, their actual taken-for-grantedness is one measure of the degree to which their constitution has been achieved.
Topic:
Climate Change, Energy Policy, and Markets
Political Geography:
Germany

73. Parteigängerr und Landschaftspfleger: Eine Analyse der Parteispenden großer deutscher Unternehmen, 1984-2005

Author:
Martin Höpner
Publication Date:
06-2009
Content Type:
Working Paper
Institution:
Max Planck Institute for the Study of Societies
Abstract:
Notably during election campaigns, donations have become an indispensable part of party finance. The paper analyzes the most controversial part of this form of party finance: donations provided by corporate bodies. The data base comprehends all party donations given by the 100 largest German firms between 1984 and 2005. The readiness to donate, amounts of donations and their distribution among the political parties are being analyzed. Donations are likely to be higher when firms belong to the center of the network of interlocking directorates. Two donation strategies can be distinguished: Sponsorship of the political center-right and donations all over the political spectrum (the so-called landscape conservation strategy). During the observation period, the landscape conservation strategy has gained importance among firms but not among individual persons and employers' associations. While family-owned firms give comparatively few donations to the SPD, high degrees of employees' codetermination seem to decrease the likelihood of large donations to CDU/CSU and FDP.
Political Geography:
Germany

74. Complex, Historical, Self-reflexive: Expect the Unexpected!

Author:
Wolfgang Streeck and Sandra Mitchell
Publication Date:
12-2009
Content Type:
Working Paper
Institution:
Max Planck Institute for the Study of Societies
Abstract:
The object world of the social sciences is complex, historical and self-reflexive. It generates nonlinear effects, it is unique, and it is able to understand the theories developed about it and respond to them intentionally. Recognizing the emergent, historically contingent and self-organizing nature of the social world, and developing responsive policy vehicles for managing its complexity, requires a shift in our conception of science in general and of economics in particular.
Topic:
Economics, Political Economy, Science and Technology, and Political Theory

75. German Companies Engaging in China: Decision-Making Processes at Home and Management Practices in Chinese Subsidiaries

Author:
Geny Piotti
Publication Date:
11-2009
Content Type:
Working Paper
Institution:
Max Planck Institute for the Study of Societies
Abstract:
This paper attempts to explain why internationalization processes to China are growing despite the significant difficulties that foreign direct investments into China encounter. The answer to this question can be found in the processes of decision-making on internationalization at the company level and how these affect management practices in Chinese subsidiaries. The argument I put forward in this paper is that for the small and medium-sized enterprises the study focuses on, the decisions concerning investment in China are mainly the product of structural and legitimation pressure. Structural pressure can encourage cognitive mechanisms and behavioral consequences similar to those occurring when individuals (and organizations) cope with threat. Legitimation pressure can foster wishful thinking, which pushes actors to believe that desired options are good despite evidence to the contrary. These pressures have an impact on how well companies are prepared when they internationalize and can particularly affect some crucial management practices, leading to inefficiencies and problems in subsidiaries.
Topic:
Economics and International Trade and Finance
Political Geography:
China, Europe, Asia, and Germany

76. Uncertainty and the Market for Patents

Author:
Irene Troy and Raymund Werle
Publication Date:
07-2008
Content Type:
Working Paper
Institution:
Max Planck Institute for the Study of Societies
Abstract:
Modern societies regard knowledge as a production factor in its own right. The market is the prevailing governance mode of their economies, and it is supposed to be the most appropriate mode of trading and allocating knowledge assets, too. But socio-economic research has revealed that knowledge markets are far from functioning smoothly. Building on ongoing qualitative research into patent trading we suggest that the emergence of a well-functioning market for patented new technological knowledge is confronted with several obstacles, which can be characterized as different facets of uncertainty. They are included in the process of creation of innovative knowledge, in its transformation into a fictitious knowledge commodity (patent), in its uniqueness, in the strategy of transaction partners, in the estimation of the future market potential of final products (based on the patent), and generally in the problem of incomplete and asymmetric information. Also a commonly accepted method of determining a patent's value is missing. We analyze structural and organizational responses to the problem of uncertainty. Potential traders often rely on contractual options, especially licensing agreements, and complementary procedural principles facilitating the trade of patents.
Topic:
International Relations, Economics, and Markets
Political Geography:
Europe

77. Von der gesteuerten Demokratie zum selbststeuernden Kapitalismus

Author:
Wolfgang Streeck
Publication Date:
07-2008
Content Type:
Working Paper
Institution:
Max Planck Institute for the Study of Societies
Abstract:
The paper is an expanded and revised version of a lecture given at the 2008 Annual Colloquium of the Max Planck Institute for the Study of Societies (MPIfG). Its subject is the relationship between social theories and political-economic change. The paper's central claim is that theories of society can by nature be fully understood only if related to and interpreted in the horizon of action of a virtual user located in the social world that is being explained. This is illustrated with reference to the development of political macrosociology since the Second World War. Next, five tendencies in today's social sciences are briefly discussed, all of which seem to indicate growing uncertainty about the practical usefulness of basic research in social science, in light of the demise of the democratic nation-state: the transition from Steuerungstheorie to research on “governance”; the departure from participatory models of democracy; the rise of economics to academic and political hegemony; a functionalist, efficiency-theoretical turn in theories of social policy; and growing doubts about the usefulness of a scientistic model of theory. In the final section it is suggested that the social sciences might find new theoretical orientation and practical self-confidence by defending in public discourse its fundamental insights on the limits of a market-driven organization of social life.
Topic:
Democratization, International Political Economy, Political Economy, and Political Theory

78. Flexible Markets, Stable Societies?

Author:
Wolfgang Streeck
Publication Date:
06-2008
Content Type:
Working Paper
Institution:
Max Planck Institute for the Study of Societies
Abstract:
The dissolution of the standard employment relationship since the 1970s has been paralleled by a destabilization of family relations. The paper, which is a slightly revised version of a plenary lecture at the 2008 Meeting of the German Sociological Association, discusses possible connections between the rise of more flexible labor market and family structures, and explores how they might tie in with the declining birth rate. The co-evolution of labor markets and family relations can be explained by both the attractions and the constraints of free markets. The current shift toward a new social policy aimed at increasing fertility is presented as an example of how expanding market relations and the uncertainty to which they give rise in personal life cause demands for state intervention. The logic seems remarkably similar to that of the current banking crisis, where the liberation of financial markets from traditional constraints and the progressive commodification of money have ultimately issued in irresistible pressures on the state to step in and restore the social commons of stable expectations and mutual confidence. In both cases, and perhaps generally, capitalism seems to imply a need for a public power capable of creating substitutes for social relations invaded by market relations and as a consequence losing their capacity to perform some of their previous functions.
Topic:
Government, Markets, Political Economy, and Political Theory
Political Geography:
Germany

79. Der kollektive "Buddenbrooks-Effekt"

Author:
Christoph Deutschmann
Publication Date:
05-2008
Content Type:
Working Paper
Institution:
Max Planck Institute for the Study of Societies
Abstract:
The paper views the current financial crisis in light of long-term structural socioeconomic changes in advanced industrial societies. In Western Europe, the United States and Japan, the period of economic prosperity after the Second World War led to a remarkable accumulation of wealth among the middle class that had surprisingly little effect on the substantial fortunes of the wealthiest upper class. This affluence gave rise to pension and investment funds emerging as a new type of collective actor in global financial markets, while the economy was marked by increasing instability, declining growth rates and financial crises. The paper tries to clarify the interconnections between these phenomena using the framework of a multilevel analysis that culminates in a model I call the “collective Buddenbrooks effect” (“Buddenbrooks” being a family saga by Thomas Mann): Structural upward social mobility will lead to an increasing imbalance in capital markets, since the volume of financial assets looking for profitable investment will rise as the social reservoir of solvent debtors and promising investment opportunities decline. Advanced industrial economies are thus characterized by a bias towards capital export and excessive financial liquidity, with the well-known consequences of low economic growth rates and the danger of speculative bubbles on global capital markets. The middle class that originally benefitted from postwar prosperity is negatively affected, too. I argue that the current crisis cannot be understood sufficiently without taking this structural socioeconomic background into account.
Topic:
Economics, International Political Economy, International Trade and Finance, Political Economy, and Political Theory
Political Geography:
United States, Japan, and Europe

80. Economic Sociology and Political Economy: A Programmatic Perspective

Author:
Jens Beckert and Wolfgang Streeck
Publication Date:
04-2008
Content Type:
Working Paper
Institution:
Max Planck Institute for the Study of Societies
Abstract:
The paper presents some of the ideas underlying the current research program of the Max Planck Institute for the Study of Societies (MPIfG). It begins with a discussion of how the institute's programmatic orientation has evolved since it was founded in 1984. Programmatic change over the years involved (1) recognition of a secular decline in the capacity of the nation-state to organize and guarantee social order, and of the growing significance of self-regulating, “free” national and international markets for social life; (2) increased attention to issues of meaning and to “culture” and cultural symbolism, as well as to normative questions; (3) a gradual shift in emphasis from policy to politics; and (4) more explicit recognition of history and of the historicity of the questions posed and the observations analyzed in social science. The second part of the paper argues that Gesellschaftsforschung today is most appropriately conceived as the study of the economy and society of contemporary capitalism. It is suggested that the most promising approach is close cooperation between the scholarly traditions of political economy and economic sociology, with the former standing to benefit from a more explicit micro-foundation in a sociological theory of action and the latter from more systematic consideration of politics and the state. Third, the paper shows how the approach that has evolved at the MPIfG differs from mainstream economic sociology, from the so-called new institutional economics, and from behavioral economics. The paper concludes by enumerating four subject areas that are likely to be of particular importance for research at the MPIfG: (1) the nature of rational-economic action, (2) the constitution of markets, (3) the emergence and change of institutions, and (4) the relationship between capitalism and democracy.
Topic:
Economics, International Political Economy, Political Economy, and Political Theory