The Concise Oxford Dictionary of Politics (60 page)

 
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A group of people legally authorized to act as if it were a single person. Once such a group with a common purpose is incorporated, whether by royal charter (the Hudson's Bay Company (1670), or the British Broadcasting Corporation (1926), or under successive facilitatory Companies Acts of the kind passed in Anglo-Saxon legal systems since the middle of the nineteenth century, it has legal personality. This means that it can sue and be sued in the courts as though it were an individual. Under British law an office held by an individual may also be corporate in character, to allow distinction in law between, for example, the Crown and the reigning monarch. There are in addition some bodies, notably trade unions and
quangos
, which have from time to time enjoyed effective corporate status under different legal instruments. Together these form the chief institutions of mediation between individual and state under
corporatism
. In Britain the term is now much less frequently used than in the past to refer to local government authorities—in recognition, perhaps, of their diminished autonomy—and has therefore become virtually synonymous with the incorporated business firm or company. Originally devised in early modern Europe chiefly to permit provision of utilities or services of a clearly public character (banking, insurance, the defence of a trade route, or consular and diplomatic services), incorporation is now almost universally linked to the principle of limited liability of shareholders and resorted for the whole range of enterprises undertaken for profit, whether or not they have strong public implications. Functional equivalents in other legal systems include the ‘société anonyme’ of the francophone and the ‘sociedad anonima’ of the Hispanic world.
CJ 

 
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The central core of corporatism is the notion of a system of interest intermediation linking producer interests and the state, in which explicitly recognized interest organizations are incorporated into the policy-making process, both in terms of the negotiation of policy and of securing compliance from their members with the agreed policy. However, one of the characteristics of the debate in the social sciences from the mid-1970s onwards about corporatism was the failure of the participants to agree about the meaning of the term. There was agreement that the area being studied was that of relations between organized interests and the state. There was some agreement that the discussion was particularly concerned with interests that arose from the division of labour in society, and particularly attempts to reconcile conflicts between capital and labour. However, while some analysts insisted that corporatist arrangements had to be tripartite, involving the state, organized employers, and organized labour, others insisted that they could be bipartite between the state and one of the other ‘social partners’, or between the ‘social partners’ themselves. There was a measure of agreement that whereas conventional
pressure groups
made representations about the content of public policy, corporatism involved a mixture of representation and control. In return for being involved in the formulation of public policy, corporatist interest groups were expected to assist in its implementation. This was sometimes captured through the idea of ‘intermediation’ which some analysts saw as central to the idea of corporatism (A. Cawson), although others doubted whether intermediation was unique to corporatism and therefore could be regarded as its distinguishing feature.
Although the modern debate started in the mid-1970s, the idea of corporatism has a long history. Guilds or corporations were important institutions in mediaeval life, but attracted little attention from political theorists. Conscious reflection about the potential prescriptive value of corporatist arrangements really started in the last quarter of the nineteenth century. In the papal encyclical Rerum Novarum (of new things, but more usually called ‘The Condition of the Working Classes’), published in 1891, Leo XIII tackled the problems of the poverty of the working classes, the development of trade unions, and the prevalent ‘spirit of revolutionary change’. It was argued that class conflict was not inevitable, but that capital and labour were mutually dependent. Noting the general growth of associative action, Leo XIII argued that problems such as working conditions and health and safety could be dealt with by specially established organizations or boards, with the state sanctioning and protecting such arrangements. The object of proceeding in this way was ‘in order to supersede undue interference on the part of the State’. This concern with limiting direct state intervention, and finding alternative forms of state-sanctioned associative action, has remained a central theme of the corporatist debate. The association between corporatism and Catholic social theory has also remained a strong one.
After the First World War, the idea of corporatism was taken up by the radical right, in particular by Mussolini who placed it at the centre of the fascist regime in Italy. As a consequence, corporatism suffered from guilt by association. It came to be regarded as a synonym for fascism and disappeared from most political discussion, although it survived in Spain and especially Portugal.
There was, nevertheless, an alternative liberal version of corporatism which was clearly distinct from the surviving remnants of authoritarian corporatism. Samuel Beer made use of the term in his Modern British Politics (1965), forecasting that ‘The further development of corporatism is surely to be expected’. Andrew Shonfield's
Modern Capitalism
, published in the same year and one of the most influential mid-century works on political economy, discussed the concept in terms of a corporatist management of economic planning in which the main interest groups were brought together to conclude bargains about their future behaviour.
The index entry for ‘corporatism’ in Shonfield's book reads ‘see also Fascism’, and it was the objective of the new generation of neocorporatist writers, led by Philippe Schmitter , to strip corporatism of its fascist associations, and to reinvent the concept as a means of analysing observable changes in a number of Western democracies, although perhaps particularly marked in small and prosperous countries such as Austria and Sweden. In 1974, Schmitter published Still the century of Corporatism?, the title referring to Mihail Manoilesco's 1934 prediction that, just as the nineteenth century was that of liberalism, the twentieth century would be that of corporatism. Schmitter wished to escape from what he saw as an unhelpful dominance of pluralist analysis in American political science, although his own work on corporatism was considerably influenced by earlier work he had undertaken in Brazil.
Schmitter triggered off an academic ‘growth industry’ on corporatism. In part, this was because it helped the understanding of long-term political phenomena such as the social pacts in Sweden and Switzerland, or the Parity Commission in Austria. Corporatism's appeal was wider, however, than explaining the politics of some of the more prosperous smaller European democracies where it was always difficult to decide whether corporatism promoted prosperity, or prosperity made corporatism possible because everyone came away from the bargaining table with something. Modern neocorporatism can perhaps best be understood as part of the breakdown of neo-Keynesianism. In the postwar period, Western governments had attempted to maintain full employment through techniques of aggregate demand management. This had, however, led to inflationary pressures, which became much worse after the first oil shock in 1973. Hence, governments increasingly turned to incomes policies as a means of restraining inflation while maintaining a demand management policy. This inevitably led them into agreements with the large producer groups, even in countries like Britain which had a predisposition for liberal solutions to economic problems. In particular, the unions were often offered concessions on social issues (employment law, taxation, social benefits) in return for agreeing to assist in the restraint of wage increases. The organized employers were also brought into the bargaining picture, in part because their assistance might be required in relation to price restraint, but also to act as a counterweight to the unions. The link between incomes policy and corporatism is illustrated in a study by Helander of the development of incomes policy in Finland which required the creation of new institutions and alterations in the functions of some existing ones. The Finnish political system changed into a two-tier one with parliamentary and corporatist subsystems.
Although the debate on corporatism produced a considerable volume of research output, it is often regarded as flawed for a number of reasons. First, there was the failure to agree on what was actually being discussed. Second, although corporatism claimed to be distinctive from pluralism, it shared many of pluralism's assumptions, and could be presented by its opponents as little more than a subtype of pluralism. Third, the debate really developed just as the phenomena it was examining became less central to the political process. More liberal solutions to problems of economic policy became favoured in a number of European countries in the 1980s as social democratic parties lost power. Moreover the focus of debate moved away from the politics of production to the politics of collective consumption, as issues such as environmental problems moved higher up the political agenda. They are less amenable to corporatist solutions, and the relevance of a modernist concept like corporatism to more
post-modernist
forms of politics is open to question. Fourth, the debate was characterized by a failure to separate analysis and prescription. Many, although not all, of the writers on corporatism were either openly (C. Crouch ) or covertly sympathetic to its use as a means of providing a ‘middle way’ that would satisfy the legitimate aspirations of organized labour whilst maintaining a capitalist mode of production. Corporatism was often defended in terms of its effectiveness in securing desired economic goals (high growth, low inflation, low unemployment), but there was a recognition that it could have undesirable political consequences. It lacked
legitimacy
as a mode of governance, emphasizing functional rather than territorial representation. It tended to bypass legislatures by creating new unelected bodies, such as economic councils of various kinds, and while it included some interests, it excluded others (smaller businesses, consumers). Fifth, as the debate developed in the 1980s, it focused increasingly on examples of sectoral or meso corporatism rather than at the macro level. Although many examples of corporatism were uncovered in particular policy areas (such as training policy and in many areas of agricultural policy), the explanatory value of corporatism as a model of the polity as a whole was thereby diminished.
Schmitter's article made a clear distinction between societal corporatism to be found in countries such as Sweden, Switzerland, and the Netherlands, and state corporatism to be found in countries such as Spain, Portugal, and Mexico, as well as Fascist Italy and Petanist France. Much of the subsequent debate focused on societal (or ‘liberal’) corporatism, although Coleman showed that the concept of state corporatism could be applied in a liberal democracy through his analysis of Quebec. With the disintegration of communist regimes in Eastern Europe and the former Soviet Union, but with the persistence of many of the old economic and bureaucratic structures, particularly in Russia, the concept of state corporatism may have acquired a new analytical relevance.
The concept of corporatism has been applied to the European Community which certainly has been influenced by the Catholic tradition of ‘social partnership’, exemplified by the ‘val Duchesse’ discussions between the Community, employers, and labour initiated in 1985. The protocol on social policy in the
Maastricht
treaty includes provisions both for consultation with management and labour, and arrangements for the joint implementation of directives by management and labour. This is an unambiguously corporatist arrangement, but if the Community had generally followed a corporatist path, the Economic and Social Committee would have been a central institution, instead of being marginalized.
The corporatist debate stimulated comparative empirical research on pressure groups as, for example, in the Organization of Business interests project co-ordinated by Schmitter and Wolfgang Streeck . Whether it provided theoretical ‘value added’ beyond the insights provided by
pluralism
remains contentious.
WG