Introduction

Between 1945 and the 1980s, successful social democratic economic policy was facilitated by Keynesian demand management policies, fostering full employment, increasing employees' incomes, and built on a close relationship between government and trade unions. This was seen most clearly in the Nordic countries and in Germany under Willi Brandt. However, elements could also be seen, for example, in British ‘Labourism’ and French dirigisme. During the last thirty years globalisation has posed profound challenges for the economies of Western Europe in general and for social democratic ideology and economic management in particular. Mass-produced goods are largely manufactured in Newly Industrialising Countries (NICs), and the number of blue-collar jobs is falling in Western Europe. In addition, advanced economic and industrial development is increasingly both regionalising and exacerbating uneven economic development within nation-states. This increases social divisions and undermines social cohesion. Nevertheless, there are still European industries, enterprises and regions which develop very competitively (Hilpert 2003, 2006). They are usually knowledge-intensive, based on high technology and scientific research, and on the manufacture of high-quality products.