What term describes a system in which business, labor, and the state negotiate over economic policy?

What term describes a system in which business, labor, and the state negotiate over economic policy?

• A. Neo-Corporatism
• B. State capture
• C. Pluralism
• D. Liberalism

Answer: (A)

Neo-corporatism describes a system in which business, labor, and the state negotiate over economic policy, usually through formal, state-sanctioned channels like tripartite councils or committees. In this arrangement the major economic actors are organized and brought into policy-making, giving them a structured role in shaping decisions on wage setting, industrial policy, and social policy. This fosters consensus and policy stability because decisions are reached through bargaining among the key groups, rather than being left to market forces or party competition alone. It’s different from pluralism, where many groups compete with looser, more decentralized influence; from liberalism, which emphasizes limited government and market-driven policy; and from state capture, where the state primarily serves the interests of a narrow group rather than facilitating broad negotiation.

Neo-corporatism describes a system in which business, labor, and the state negotiate over economic policy, usually through formal, state-sanctioned channels like tripartite councils or committees. In this arrangement the major economic actors are organized and brought into policy-making, giving them a structured role in shaping decisions on wage setting, industrial policy, and social policy. This fosters consensus and policy stability because decisions are reached through bargaining among the key groups, rather than being left to market forces or party competition alone. It’s different from pluralism, where many groups compete with looser, more decentralized influence; from liberalism, which emphasizes limited government and market-driven policy; and from state capture, where the state primarily serves the interests of a narrow group rather than facilitating broad negotiation.