Political Economy of Business Power and Welfare States

Business power in modern political economies operates through both instrumental and structural channels. Instrumental power emerges from targeted lobbying, coalition building and public discourse shaping, whereas structural power derives from firms’ indispensable role in production, employment and investment. Welfare states mediate this influence through varied institutional forms, from social‐democratic universalism to liberal market regimes. Over the past four decades, neoliberal reforms—characterised by deregulation, privatisation and financialisation—have altered the balance between corporate interests and social protection. These shifts have fostered new mechanisms of state–business interaction, such as corporate welfare schemes that channel public funds to firms without reciprocal obligations, and the financialisation of core welfare services that transforms citizens into consumers of profit‐driven provision. Understanding these dynamics is essential to grasp how policy choices on taxation, public expenditure and market design are shaped, and to identify avenues for reinforcing social cohesion and economic resilience in the face of growing corporate influence.

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Political Economy of Business Power and Welfare States publication trend

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Technical terms

Structural power: The capacity of firms to shape policy agendas and constrain state choices through their critical economic functions.
Instrumental power: Direct influence exerted by businesses via lobbying, coalition‐building and discourse framing.
Corporate welfare: Public funding or benefits directed to corporate entities with minimal or no conditionality, reflecting structural privilege.
Financialised accumulation: An economic regime in which financial actors and logics dominate production and social provision, prioritising profit extraction over universal service delivery.

References

1. How does business power operate? A framework for its working mechanisms. Business and Politics (2022).
2. No strings attached: Corporate welfare, state intervention, and the issue of conditionality. Competition & Change (2022).
3. Financialized accumulation, neoliberal hegemony, and the transformation of the Swedish Welfare Model, 1980–2020. Capital & Class (2022).