Skip to main content
×
×
Home

Taking back Control or Empowering Big Business? New Risks to the Welfare State in the post-Brexit Competition for Investment

  • KEVIN FARNSWORTH (a1)
Abstract
Abstract

Capitalist economies depend on private business investment, and all governments in similar states compete to induce businesses to invest through various policy interventions. In so doing, they compete with other governments to retain current investors and to encourage new ones from elsewhere. The implications for policy-making and, by extension, citizens, are huge. The pressure on governments to capture new investment has an impact on taxation policies, workplace regulations, legal protections, public infrastructure and social policies. However, not all governments compete for investment in the same way at the same time, and not all businesses are attracted by the same inducements offered by states, highlighting the possibility that public policies shape investment strategies, just as investment strategies also shape public policies. It is its development of relatively unique and aggressive strategies to capture new investment that places the UK in a vulnerable position post-Brexit. It has successfully attracted mobile corporations to its shores, in part because it has offered a particularly favourable gateway into Europe for foreign capital. This raises questions about how the country will seek to compete for capital investment in future. This paper examines these questions with reference to both theoretical and empirical evidence.

  • View HTML
    • Send article to Kindle

      To send this article to your Kindle, first ensure no-reply@cambridge.org is added to your Approved Personal Document E-mail List under your Personal Document Settings on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part of your Kindle email address below. Find out more about sending to your Kindle. Find out more about sending to your Kindle.

      Note you can select to send to either the @free.kindle.com or @kindle.com variations. ‘@free.kindle.com’ emails are free but can only be sent to your device when it is connected to wi-fi. ‘@kindle.com’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.

      Find out more about the Kindle Personal Document Service.

      Taking back Control or Empowering Big Business? New Risks to the Welfare State in the post-Brexit Competition for Investment
      Available formats
      ×
      Send article to Dropbox

      To send this article to your Dropbox account, please select one or more formats and confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your Dropbox account. Find out more about sending content to Dropbox.

      Taking back Control or Empowering Big Business? New Risks to the Welfare State in the post-Brexit Competition for Investment
      Available formats
      ×
      Send article to Google Drive

      To send this article to your Google Drive account, please select one or more formats and confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your Google Drive account. Find out more about sending content to Google Drive.

      Taking back Control or Empowering Big Business? New Risks to the Welfare State in the post-Brexit Competition for Investment
      Available formats
      ×
Copyright
References
Hide All
Arnold M. (2017), ‘City of London pushes for lower taxes to sweeten Brexit pill’, Financial Times, March 17.
Barker A. and Robinson D. (2016), ‘UK faces Brexit bill of up to €60bn as Brussels toughens stance’, Financial Times, November 15.
Barker A. Brunsden J. and Arnold M. (2016), ‘EU to retaliate against US bank capital rules’, Financial Times, November 21
Block F. (1977), ‘The Ruling Class Does Not Rule: Notes on the Marxist Theory of the State’, Social Revolution, 7 (3):628.
Boffey D. (2017), ‘Britain set to lose EU ’crown jewels’ of banking and medicine agencies.’ The Guardian, April 15.
Cox J. (2017a), ‘Toyota examining ’how to survive’ in post-Brexit Britain after Theresa May's Single Market announcement.’ The Independent, January 19.
Cox J. (2017b), ‘Lloyds ‘chooses Berlin' as base for its European hub post-Brexit.’ The Independent, April 17.
Dhingra S., Ottaviano G., Sampson T. and Van Reenen J. (2016), The impact of Brexit on foreign investment in the UK. (London: London School of Economics and Political Science).
Eggar T. (1994), ‘Debate on Inward Investment’, House of Commons, 29 October 1994. London: Hansard Parliamentary Record.
Esping-Andersen G. (1990), The Three Worlds of Welfare Capitalism. (Cambridge: Polity Press).
Farnsworth K. (2004), Corporate Power and Social Policy in Global Context: British Welfare Under the Influence? (Bristol: Policy Press).
Farnsworth K. (2012). Social versus Corporate Welfare: Competing Needs and Interests within the Welfare State. (London: Palgrave).
Farnsworth K. and Fooks G. (2015), ‘Corporate Taxation, Corporate Power, and Corporate Harm.’ Howard Journal of Criminal Justice, 54 (1):2541.
Giles C. (2017), ‘Brexit will damage UK standards of living, say economists.’ Financial Times, April 16.
Gill S.R. and Law D. (1989), ‘Global Hegemony and the Structural Power of Capital.’ International Studies Quarterly, 33:475–99.
Gough I. (1979), The Political Economy of the Welfare State. (London: Macmillan).
Hacker J. S. and Pierson P. (2002), ‘Business Power and Social Policy: Employers and the Formation of the American Welfare State’, Politics and Society, 30 (2):277325.
Hall Peter A. and Soskice D. (Eds.) (2001), Varieties of Capitalism: The Institutional Foundations of Comparative Advantage (Oxford: Oxford University Press).
Hicks A., and Kenworthy L. (2003), ‘Varieties of Welfare Capitalism.’ Socio-economic Review 1:2761.
Hirschman A. O. (1990), Exit, Voice and Loyalty: Responses to Decline in Firms, Organisations and States. (Harvard: Harvard University Press.
Hopkins N. and Mason R. (2017)‚‘What Theresa May really thinks about Brexit shown in leaked recording’, The Guardian, October 26.
House of Commons (2017), International Trade Committee: Oral evidence, UK trade options beyond 2019, HC 817-iv. (London: House of Commons).
KPMG (2016), Press Release: Post-Brexit CEOs buzzing with confidence but cautiously contingency planning, according to latest KPMG research, 26 September. (London: KPMG).
Le Roy G. (2005), The Great American Jobs Scam, Berrett-Koehler Publishers).
Lindblom C. E. (1977), Politics and Markets. (New York: Basic Books).
Mares I. (2001), ‘Firms and the Welfare State.’ in Hall and Soskice (2001), Varieties of Capitalism: The Institutional Foundations of Comparative Advantage (Oxford: Oxford University Press).
Martin B. (2017), ‘HSBC chairman: Brexit could trigger ’Jenga tower’ of City job loses.’ The Telegraph, January 10.
O'Brien R. (1997), Subsidy Regulation and State Transformation in North America, The GATT and the EU. (Basingstoke: Macmillan).
OECD (2016a), Revenue Statistics. (Paris: OECD).
OECD (2016b), Tax Policy Reforms in the OECD. (Paris: Organisation for Economic Cooperation and Development).
Offe C. and Ronge V. (1984), ‘Theses on the Theory of the State.’ in Contradictions of the Welfare State, edited by Offe C.. (London: Hutchinson).
ONS (2014), Business Ownership in the UK. London: Office for National Statistics.
Pierson P. (1995), ‘Fragmented Welfare States: Federal Institutions and the Development of Social Policy.’ Governance, 8 (4):447–48.
Portes J. (2015), ‘After Brexit: how important would UK trade be to the EU?’ National Institute of Economic and Social Research.
Shotter J., Noonan L., and Arnold M. (2017), ‘Frankfurt takes early lead in Brexit race to poach City jobs.’ Financial Times, March 21.
Swenson P. (2002), Capitalists Against Markets: The Making of Labor Markets and the Welfare States in the United States and Sweden. (Oxford: Oxford University Press).
Thomas K. P. (2000), Competing for capital : Europe and North America in a global era. (Washington, D.C.: Georgetown University Press).
Vogel D. (1989). Fluctuating Fortunes: The Political Power of Business in America. (New York: Basic Books).
Ward H. (1986), Structural Power - A Contradiction in Terms? (Essex: Department of Government, University of Essex).
Winters J. A. (1996), Power in Motion: Capital Mobility and the Indonesian State. (Ithaca, New York: Cornell University Press).
Witt M.A. and Jackson G. (2016). ‘Varieties of Capitalism and institutional comparative advantage: A test and reinterpretation.’ Journal of International Business Studies, 47 (7): 778806.
Recommend this journal

Email your librarian or administrator to recommend adding this journal to your organisation's collection.

Journal of Social Policy
  • ISSN: 0047-2794
  • EISSN: 1469-7823
  • URL: /core/journals/journal-of-social-policy
Please enter your name
Please enter a valid email address
Who would you like to send this to? *
×

Metrics

Altmetric attention score

Full text views

Total number of HTML views: 52
Total number of PDF views: 261 *
Loading metrics...

Abstract views

Total abstract views: 589 *
Loading metrics...

* Views captured on Cambridge Core between 14th July 2017 - 16th December 2017. This data will be updated every 24 hours.