Peer Hull Kristensen and Kari Lilja (eds),Nordic Capitalisms and Globalisation

Peer Hull Kristensen and Kari Lilja (eds), Nordic Capitalisms and Globalisation. Oxford, UK: Oxford University Press, 2011. 300 pp.

This is an interesting book that presents very comprehensive research on developments in business systems and firm and employee behaviour in the Nordic countries (Denmark, Finland, Norway and Sweden). It provides a discussion of various theoretical approaches and it deals with each country in a detailed fashion, including an analysis of the general business, welfare and labour market trends and issues in the last two decades as well as several organizational case studies to illustrate particular national and organizational developments.

It will be an important book for many researchers in international and comparative employment relations as it seeks to develop the research approach associated with the concept of national business systems (see Whitley, 1992; Whitley and Kristensen, 1996, 1997). In fact, the editors regard the book as being part of the third phase of the national business system research programme. As such, it continues the cross-national studies of institutional frameworks, actors and businesses. The book provides a particular comparative angle since it focuses on Nordic countries, as its authors try to explain why these countries have survived and prospered recently. Finally, the book will be of interest to many comparative researchers since it develops a ‘bottom-up’ research approach where researchers have tried to investigate how individual organizations have prospered in a more globalized business world with new value chains, mergers and working arrangements.

Why is it that Nordic countries have done so well when they seem to follow the ‘wrong’ reform prescriptions? Despite the ‘Washington Consensus’ and regular Organisation for Economic Co-operation and Development (OECD), International Monetary Fund (IMF) and World Bank reports on reducing the public sector, taxes and state intervention, there has been the paradox of the Nordic countries:

Despite high taxes, high unionization rates, and egalitarian income distribution they demonstrated from the mid-1990s to 2008 that it was possible to improve competitiveness, secure macroeconomic balances, lower unemployment, and engage a high proportion of women, youngsters, and senior people in economic activity, while state institutions played a large role in the economy. (p. vii)

The explanation given in the book is that the ‘wrong’ approach can have many beneficial effects. In particular, an extensive welfare state can have many positive effects in a globalized world where employers and employees need to experiment in order to search for new opportunities in a fast-changing international marketplace. Widespread experimentation with new business models, new working arrangements and new career and living patterns is necessary if Nordic organizations – many being of a limited size – are going to prosper in a more globalized competitive environment. It has been well-known that the comprehensive skills and education systems of the Nordic countries have been a major part of their continuous success in upgrading their competitive advantage. The Nordic states have also been active in facilitating public–private research and development (R&D) initiatives and clusters. These arguments are illustrated in numerous details in the book’s various national chapters and organizational case studies, but the book goes beyond the traditional focus on skills, training and education and R&D initiatives. It is shown ‘that the Nordic welfare states enable firms and employees on a broader scale to engage in the mobile life of learning organisations’ (p. 26). This includes classical supports of working people such as crèche and kindergarten facilities, paid parental leave and protected jobs, but Nordic countries have gone much further with individualized employment planning, transfer/job change supports, temporary leave schemes and individualized social services. As such, the Nordic understanding of active labour market policies entails an overlap between social welfare and labour market measures and tends to be geared to local and individual (employer and/or employee) circumstances.

The four country chapters present empirical research of a very high quality, as one would expect with its dedicated national research teams of well-established researchers. The chapters fall into three broad sections: the broader national context, organizational case studies and discussion of the findings. The discussions of the broader national context will be of interest to many comparative researchers as they present a comprehensive picture of the various national trends and situations, based on detailed information and research projects ranging ‘from labour-market issues to education, from product and process innovations to new business models, from health care services to investments in infrastructure’ (p. xi). The organizational case studies are well-developed and, personally, I felt that they constitute the real highlights of this book. The case studies point to many of the rather dramatic changes that Nordic organizations have experienced in the last couple of decades. They also illustrate how the organizations and their employees are involved in a series of experiments that may or may not end up enhancing their competitiveness and employability. However, without these experiments – the willingness to participate in ongoing change – there would be far fewer Nordic success stories and the countries would not score so well in international comparisons.

While this book provides fascinating theoretical and comparative discussions, it is probably not a book for the novice comparative researcher. Although the writing could be improved in terms of directness and accessibility, it is more the thinking and the variety of information that may prove a barrier to many researchers. The success of Nordic countries is clearly inexplicable within the traditional Anglo-American discourse of public policy and the book itself stresses several times that the positive outcomes – all those high scores on various international measures – are not a result of a great master plan, but the fortuitous end product of several, sometimes unrelated, adjustments in face of international and local pressures. These adjustments – or experiments, as the book often calls them – are illustrated by the case studies, but it is very difficult to explain fully the range and overall importance of these experiments. This is the problem with taking a bottom-up research approach – that it can often be impossible to show how the diverse organizational and employee experiments can end up giving a country a competitive advantage. Finally, there are many instances where the book shows that there are countervailing forces, the possibility of other (negative) outcomes as well as diverse influences that may or may not lead to different outcomes in the near future. This is typical of the soul-searching and continuous doubts of Nordic researchers, which should probably be recommended to all researchers, but it makes the overall message of the book less clear-cut.

This is a book that seeks to extend our theoretical knowledge, our understanding of (Nordic) capitalism and institutional renewal, and our knowledge of how competitiveness and productive employment relationships can be built. It opens up different perspectives, presents new empirical evidence and debates the likely outcomes of various patterns of strategies and behaviours. I was both fascinated and puzzled by the book.