Creative Corporatism

This article documents and explains the surprising capacity of several Continental European countries to adapt to rapid, innovation-based competition. Critics and proponents alike suggest that these economies rely on incremental upmarket movement in low- and medium-technology industries. Several historically low-technology Nordic countries, however, have recently assumed leading positions in industries such as biotechnology, software, and telecommunications. The article resolves this puzzle by arguing that these countries have adapted institutionalized cooperation among organized economic actors to invest in new supply-side resources, including venture capital, skill formation, and research. This pattern of “creative corporatism” has very different implications for economic adjustment, facilitating movement into new high-technology industries. The article supports the argument by analyzing institutional change and economic restructuring in Finland, a critical case where high-technology competition is least likely. The article documents similar developments in Denmark and Sweden, situating all three cases in relation to literature on comparative political economy.