Democracy and Corporatism

While many countries in Western Europe and South America effectively used corporatism to augment their governance systems in the 1970s, political ideology posed significant difficulties to the existence of democratic space in these countries. The political arrangement includes corporatism, which allows network organizations with professional, industrial, and economic representations to exist as legitimate groups in a country's policy-making process. Proponents of the political setting defended the philosophy as an effective government structure that represented society's wishes and opinions. However, the consensus-based decision-making process embedded in corporatist economies jeopardizes democratic ideals, particularly inclusive government and individual liberties.While corporatist ideals put emphasis on the interest of corporations and the system, democracy often prioritizes the rights of individual citizens (Almond & Verba, 2015). This article takes an in-depth discussion of corporatism and democracy, as well as how the former factor curtails the democratic processes in many economies.


The economic crises encountered by the advanced capitalist states in the 1970s gave rise to the widespread study of neo-corporatism in many nations across the globe (Marginson & Considine, 2000). The subsequent studies attempted to ascertain the reasons why corporatist economies performed better in responding to the economic crises mentioned above (Hunold, 2001). Of more importance to this article is the negative impact of the political system on the democratic process in the contemporary society. Although there have been heightened debates on corporatism in the last several decades, the ideological controversies and inadequate definition of the concept contributes to its elusiveness as witnessed in the current political setting (Lehmbruch, 2003). Corporatism entails a political practice and arrangement where professional groups represent the interests of the society (Marginson & Considine, 2000). Such groups like industrialists, artisans, lawyers, workers, farmers, and churches among other interest groups participate in the governance of an economy not only to represent their interests but also act as a link between the members and the government. Many economies in Western Europe and South America adopted the corporatist form of political system in the early 1970s (Doctor, 2007). However, most of the countries across Europe opted to replace the corporatist ideals with pluralism except nations like Australia (Cappelen, Hole, Sørensen & Tungodden, 2007). According to Wood and Harcourt (2000), Australia embraced corporatism as a form of governance, where the relationship between the business, government, and the society became more pronounced by espousing specific corporatist characteristics. Contrary to the corporatist ideals that emphasize on effectiveness, development, and consensus on governance issues, pluralism takes into account responsiveness, accessibility, and democracy (Cappelen, Hole, Sørensen & Tungodden, 2007). Critics of the corporatist political arrangement have often criticized its ideals for depriving the citizens of adequate representation, free competition, civic liberties, as well as democracy.

While different political idealists may have divergent perspectives on the exact meaning of democracy, the concept often refers to the free and fair rule by the people, as well as other forms of participation in the political process. According to Almond and Verba (2015), people are often the ultimate authority in democratic societies, and that they provide consent on governance issues. The democratic process also provides for free and fair elections as well as other forms of civic participations by individual citizens.

Research carried out by Textor demonstrates the level of distrust among nationals in the ability of the government to reform the political system in an attempt to change the condition and direction of the country (Kelly, 2017). According to the prominent analyst, the public worry and distrust the political system, and have doubts about its strength to bring any meaningful changes to the nation (Kelly, 2017). Textor concludes the analysis by alluding to the fact that the loss of trust and reputation in the country’s governance model has enormous challenges to the Australian democracy (Kelly, 2017).

Corporatism in Democracy

While many countries in the Scandinavia and South America have often embraced corporatism as a mode of governance in their political systems, opponents of the ideology such as the liberals pose legitimate opposing views on corporatism. According to Meade and O'Donovan (2002), the basis of fierce criticism of corporatism political system by the liberals has a basis on the fact that such ideology elevates collectivist corporate entities to the mainstream economic and political systems of a nation. The above arrangement denies the citizens access to free competition, individual representation, and democracy as stipulated in democratic ideals. Both the communists and socialists put a spirited fight against corporatism, citing its oppressive culture of capitalist class rule. Instead of allowing individual citizens to participate freely in their economy’s governance and decision-making process, corporatism subscribes to a system where interest groups represent members on such fundamental issues.

Unlike economies that embrace corporatism, democratic states exhibit certain aspects of sound governance and political systems. According to Wood and Harcourt (2000), corporatism is a school of political ideology that rivals representative governance. Unlike democratic governments that encourage voting by the individual citizens, the political system in the corporate states reduces the citizens to the secondary participants (Wood & Harcourt, 2000). The economy is not only left at the disposal of interest groups who often participate in decision-making processes as well as negotiate on behalf of their members. Bispinck and Schulten (2000) argue that the threat to democracy in the contemporary society arises when the political system accords organizations the authority to represent their interest and those of their members rather than allowing individuals citizens to make such decisions. According to Bispinck and Schulten (2000), a threat to democracy manifests when the state prioritizes, for instance, the interests of multinational organizations at the expense of the rights of its citizens as witnessed in corporatist nations. In this respect, Bispinck and Schulten (2000) once argued that corporatism as a political system exhibits one of the totalitarian ideologies which put emphasis on the system rather than the rights of the citizens.

The corporation between the interest groups participating in the governance of an economy further escalates the risks of developing anti-democratic form of corporatism. A notable reason for the scenario mentioned above is the fact that there is often a close relationship between the employees at the top of such entities than compared to the people at the bottom of the organizations. According to Doctor (2007), employees at the top of the organizations always enjoy benefits attributed to them, including lucrative salaries, and have similar characteristics such as education and personal interests. As a result, they often focus on providing joint solutions with the interest of the corporative process as a priority rather than the people on whose behalf they are working.

Corporatism has negative effects on inequality among citizens in a country. A study carried out in 2008 by Bermendi and Anderson reported positive results on hypotheses that tested the adverse effects of policies on inequality under corporatism. According to the researchers, the absence of corporatism provides an environment where the effectiveness of policies is reducing inequality manifests (Bermendi & Anderson, 2008). Inequality in this case revolved around wage disparity among individuals under study. The medieval guild system in the traditional settings presented substantial benefits to the professional members regarding economic, religious, political, and socio-cultural functions as provided under corporatism. These functions included caring for orphans and widows, the setting of proper wages, prices, education, and work standards among other amenities.

However, the political system mentioned above compromises democracy as the for-profit organizations have turned to colonize the government systems whose original intention was to serve the citizens (Molina & Rhodes, 2002). In the contemporary society, for instance, multinational corporations have taken advantage of their wealth, size, as well as influence to assert their authority on the state, thereby dictating the governance processes in many countries (Molina & Rhodes, 2002). Of more importance is the concentration of these corporations as well as their ability to infiltrate governments and defend their interests. The enormous power and capacity of the corporations in the corporatist states have played a critical role in compromising democracy in many states in the modern world.

In addition to threatening the existence of democracy in many economies, corporatism also presents enormous risks to citizenship. According to the liberal theory, the very definition of citizenship lies in the political rights that individuals confer. For instance, Molina and Rhodes (2002) demonstrate that these rights encompass the rights of individual citizens to participate in political activities such as voting among other rights. While corporatism focuses on the political system, liberals argue that individual rights surpass the system (Wood & Harcourt, 2000). In this respect, corporatism presents a threat to both the democratic process as well as citizenship as it undermines the provisions for individual rights.


Many of the economies in Western Europe and South America embraced corporatism as their preferred political system before replacing the ideals of pluralism in the recent past. These countries reported significant success in tackling the economic crises that rocked many parts of the world. Unlike pluralism, corporatism provided for a governance system where the interest groups participated alongside the parliamentary system and the state in making fundamental policy decisions. As mentioned, corporatism ensured effectiveness, consensus, and development, with its main focus on the system and the interest of the corporations. However, studies tend to show that the political arrangement under the corporatist ideals threatens the existence of democracy and citizenship in many countries across the globe. A notable example is the fact that corporatist ideals prioritized the interests of the corporations at the expense of individual citizens. Under corporatist ideals, corporations defend their interests and often act as an intermediary between the state and the society. While such an initiative may be effective in steering the economic development and representation of the societal needs and interests, it hampers the participation of individual citizens in the political process. The multinational corporations in the modern world have taken advantage of their wealth and capabilities to infiltrate the governments, thereby defending their interests and not of the people they represent. Critics of the corporatist political arrangement criticize its ideals for depriving the citizens of adequate representation, free competition, civic liberties, as well as democracy.


Almond, G. A., & Verba, S. (2015). The civic culture: Political attitudes and democracy in five nations. Princeton University Press.

Bermendi, P. & Anderson, C.J. (2008). Democracy, Inequality, and Representation in Comparative Perspective. London: Russell Sage Foundation

Bispinck, R., & Schulten, T. (2000). Alliance for jobs-is Germany following the path of" competitive corporatism"? Düsseldorf.

Cappelen, A. W., Hole, A. D., Sørensen, E. Ø., & Tungodden, B. (2007). The pluralism of fairness ideals: An experimental approach. The American Economic Review, 97(3), 818-827.

Doctor, M. (2007). Lula's development council: neo-corporatism and policy reform in Brazil. Latin American Perspectives, 34(6), 131-148.

Hunold, C. (2001). Corporatism, pluralism, and democracy: Toward a deliberative theory of bureaucratic accountability. Governance, 14(2), 151-167.

Kelly, P. (2017). Democracy under threat as trust in system broken. The Australian. Retrieved on 16 April, 2017 from

Lehmbruch, G. (2003). Concertation and the structure of corporatist networks. In Verhandlungsdemokratie (pp. 103-128). VS Verlag für Sozialwissenschaften.

Marginson, S., & Considine, M. (2000). The enterprise university: Power, governance and reinvention in Australia. Cambridge University Press.

Meade, R., & O'Donovan, O. (2002). Editorial introduction: Corporatism and the ongoing debate about the relationship between the state and community development. New York: The Free Press.

Molina, O., & Rhodes, M. (2002). Corporatism: The past, present, and future of a concept. Annual review of political science, 5(1), 305-331.

Wood, G., & Harcourt, M. (2000). The consequences of neo-corporatism: a syncretic approach. International Journal of Sociology and Social Policy, 20(8), 1-22.

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