Can Politicians Bargain with Business?

Abstract

These authors examine the capability of local government to influence economic development by formulating a framework that treats state-business relations as a bargaining process. This framework suggests that governmental influence is tied to the distribution of bargaining advantages along three dimensions of a liberal-democratic political economy: market conditions, popular-control systems, and public-intervention mechanisms. The authors offer an explanation of how characteristics of these dimensions strengthen or weaken city governments in dealing with private enterprise; experiences of U.S. and Western European cities are drawn upon to illustrate this. They conclude that differences in bargaining resources accounts for wide variation in local political control of business development.