Institutional Change in OECD Democracies, 1970–2000

Abstract

Four major institutional characteristics of advanced democracies have been scrutinized in this paper: the horizontal and vertical structure of the political system (majoritarian vs consensus democracy, federalism/decentralization vs unitary state/centralisation), the welfare state and the relationship between organized interests and the state (pluralism vs corporatism). This paper is concerned with the extent, direction and causes of changes in these four institutional arrangements in the period 1970–2000, in economically advanced and politically established democracies in the OECD world. My research reveals limited institutional change. Although there has been similar change, no convergence occurred. Rather, certain institutional options have become harder to realize, while others have become more feasible. I argue that three core variables can explain the characteristics of institutional characteristics at the end of the period under consideration. (1) The institutional order at t−1 is the major determinant of the institutional order at t. With few exceptions, change is path-dependent and incremental following a logic of ‘layering' of new and old elements. (2) Institutional change reflects changes in the international and domestic environment of the political systems, which could be perceived as ‘unavoidable and hard constraints' on political actors. Among them were various aspects of globalization, Europeanization and the changing demographic structure of modern societies. (3) These requirements for change have had a chance to lead to institutional reform if electorates or government members do not punish political actors for supporting such reforms. Hence the institutional change must be congruent with the socioeconomic requirements and with the attitudes of the public. All three variables restrict the options available in the four institutional structures.