Introduction
Is globalization forcing non ‘Coordinated Market Economies,’ (CMEs) such as Spain, to converge on an
Anglo-American model? In the opinion of some scholars, the combined impetuses of globalization and the
process of European monetary unification have imposed exigencies of increasing competitiveness on
national economies, which have compelled countries to deregulate their labor markets, welfare systems,
and industrial relations (Crouch and Streeck 1997). According to this view, these pressures for change have
undermined coordinating capacity. This research project
will challenge the interpretation according to
which the responses of European countries to these pressures are uniform, and the argument that increasing
exposure to trade, foreign direct investment, and liquid capital mobility have prompted a pervasive race to
the neoliberal bottom among countries. Contrary to those predictions, it will show that in Spain
globalization and economic integration have promoted rather that undermined the development of
cooperative institutional settings and ‘institutional complementarities.’ Unable to escape from economic
interdependence Spain has developed coordination mechanisms at the micro and macro level as a means to
address and resolve tensions between economic interdependence and political sovereignty, and between
monetary and exchange rate policies (see Cameron 1998).
Spain offers an ideal venue for examining this question because coordination has emerged in an
institutional and structural context markedly different from that of other countries. Spain cannot be
classified as a Liberal Market Economy (LMEs) (i.e., like Britain, Australia, or the United States), or as a
Coordinated Market Economy (CMEs) (i.e., like Germany, Japan, Sweden, Austria, or the Netherlands).
On the contrary, Spain displays what some authors have referred to as a distinctive "Mediterranean" style
of capitalism (Rhodes 1998). Hence, Spain offers an opportunity to research the impact of a different
institutional setting on the development of coordination capacities.
In addition, the analysis of the Spanish experience will show that arguments about the demise of
national autonomy in the global economy are overdrawn. Increasing foreign direct investment, exposure to
trade, and liquid capital mobility did not prevent the emergence and consolidation of coordination
mechanisms in Spain. The Spanish government and the social actors faced strong political incentives to
cushion, through cooperation, the dislocations generated by the integration of the Spanish economy in the
European Community (1986) and the European Monetary Union (1998). The combined impetuses of
globalization and monetary integration promoted, rather than hindered, cooperation among the economic
actors. Indeed, the study of the Spanish case will confirm that the link between changes in the international
economic environment and the process of domestic policy making also depends on domestic political and
economic factors. They provide their own set of incentives for domestic actors to entertain certain political
strategies.
This paper examines the evolving interests of capital and the structural and political constraints within
which employers define and defend their interests. The analysis of the Spanish case confirms the thesis that
strategic actors with their own interests design institutions (Thelen 2004). In Spain previous rounds of
institutional innovation (particularly the introduction of temporary contracts in the 1980s) have produced
effects (uncertainty) that in a context of competitive challenges have re-shaped employers interests and
promoted coordination. This confirms that thesis that corporations are responding differently to the
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Convention