Institutions and Economic Growth: The Politics of Productivity in West Germany, Sweden, and the United Kingdom, 1945–1955

Abstract

This article reviews Mancur Olson’s ideas concerning the impact of institutions on growth rates and national competitive performance. We suggest that Olson’s “ideal typical” methodology limits the usefulness of his approach and that institutional structures and strategies can be dependent variables. In comparing the performance of three European countries in the postwar period, we argue (contrary to strict Olsonian principles) that changing market and political environments helped to determine the kind of institutional forms that emerged. We question the weight that Olson places on the role of institutional structures and strategies on long-run economic performance.