‘business interest’. The 30 Capitalism and democracy decisive factor is whether these ‘business interests’ are complementary to labour. This distinction is important for understanding why elites may behave in different ways as Bourguignon and Verdier (2010, p. 3) argue: ‘elite-­dominated economies relying primarily on mineral natural resources are likely to behave differently than elite-­dominated economies relying on manufacturing exports’. If rent extraction is based on the exports of a natural resource labour input may be negligible and the optimal tax rate is

. Polanyi (1944) refers to this remarkable feature as ‘The Great Transformation’. North et al. (2009) discuss such a fundamental change in terms of the transformation of ‘natural states’ into ‘open access orders’. The characteristic for this revolutionizing change is that economic and political choices are no longer the prerogative of an absolute ruler with military power, but are based on free competition between organizations and groups of people. An essential condition for such a freedom of choice is that the property rights of economic agents are secured. In England

of labour (L) and the effectiveness of this factor in the production function (A). Therefore, the factor A augments the labour potential. Both L and A grow at a fixed rate. The sum of these growth rates is called the natural rate of growth (gn). It is indicated by a horizontal line in Figure 3.1. The growth rate of capital (gK) depends on the exogenous savings rate and the endogenous productivity of capital. When the effective capital-­labour ratio is low, relative capital scarcity results in a high return on investment. Consequently, the growth rate of capital is

between different forms of what he refers to as economic integration. The latter concerns the way the process of production, allocation and distribution of goods is organized and economic activities are coordinated. Before the (first) Industrial Revolution, economic systems were based on the fundamental principle of either reciprocity or redistribution, or on a combination of these two. Reciprocity or mutuality rests on the exchange of gifts in a symmetric situation. Redistribution presupposes a central authority that coordinates economic activity. Self-­interest and

settlement was positively related to both the natural logarithm of the total value of the claim (including interest and expenses) and the logarithm of the total value of all payments made from the fund in the calendar year in which the claim was received;19 thirdly, the probability of a claim being rejected was positively related to the total value of claims made in the year in which the claim was received. Thus the outcomes of claims measured in different ways appear to be related to Fund characteristics at the time the claim was received and consequently outcomes may not

, local markets and indigenous brokers connected to a broader commercial network. I am aware that the foregoing description is highly stylised, abstracting from regional differences and temporal changes. For example, in northern China climate conditions were less favorable for wet farming and water transportation, while natural disasters leading to famine were more severe. As dry farming produced fewer surpluses there, tenancy rates were lower. Instead, managerial farming, in which the principal cultivators worked together with a few hired labourers, was more frequently

which the head of the agency reports to a minister, because interest-group politics could influence the safety regulator’s decisions. There was an implicit and explicit collusion between the regulator and the regulated, entrenching both in a self-promoting nuclear industrial complex. They had not effectively responded to scientific or public warnings of possible natural disaster while regulators as well as top management of TEPCO, lacking both expertise in nuclear engineering and motivation of monitoring, did not intervene. It is telling that the entrenched group of