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A very British state capitalism: Variegation, political connections and bailouts during the COVID-19 crisis

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journal contribution
posted on 2022-01-19, 16:19 authored by Geoffrey T Wood, Enrico Onali, Anna GrosmanAnna Grosman, Zulfiquer Ali Haider
The COVID-19 pandemic has resulted in governments playing increasingly prominent roles as active economic agents. However, state capitalism does not necessarily serve broad developmental purposes, and rather can be directed to supporting sectional and private interests. As the literature on variegated capitalism alerts us, governments and other actors regularly devise fixes in response to a systemic crisis, but the focus, scale, and scope of the interventions vary considerably, according to the constellation of interests. Rapid progress with vaccines notwithstanding, the UK government's response to COVID-19 has been associated with much controversy, not only because of an extraordinarily high death rate, but also because of allegations of cronyism around the granting of government contracts and bailouts. We focus on the latter, investigating more closely who got bailed out. We find that badly affected sectors (e.g. hospitality, transportation) and larger employers were more likely to get bailouts. However, the latter also favored the politically influential and those who had run up debt profligately. Although, as with state capitalism, crony capitalism is most often associated with emerging markets, we conclude that the two have coalesced into a peculiarly British variety, but one that has some common features with other major liberal markets. This might suggest that the eco-systemic dominance of the latter is coming to an end, or, at the least, that this model is drifting towards one that assumes many of the features commonly associated with developing nations.

History

School

  • Loughborough University London

Published in

Environment and Planning A: Economy and Space

Publisher

SAGE Publications

Version

VoR (Version of Record)

Rights holder

© The Authors

Publisher statement

This is an Open Access Article. It is published by SAGE Publications under the Creative Commons Attribution 4.0 International Licence (CC BY 4.0). Full details of this licence are available at: https://creativecommons.org/licenses/by/4.0/

Acceptance date

2021-12-16

Publication date

2022-02-14

Copyright date

2022

ISSN

0308-518X

eISSN

1472-3409

Language

en

Depositor

Dr Anna Grosman. Deposit date: 19 January 2022