Uneven Development and Grounded Comparative Institutional Advantage: Lessons from Sweden and Mondragon

In this paper we use the theory of grounded comparative institutional advantage to analyze the possibilities for progressive development in the face of the uneven development patterns endemic to neoliberal capitalist development. We demonstrate that efforts to promote institutional structures to spur regional development, such as Swedish efforts to create high wage jobs via education, training, and technology diffusion, and the Mondragon Cooperative’s efforts to create and preserve manufacturing jobs via education, technology development and cooperative organization, can be a countervailing power to the forces of capitalist uneven development, if the state becomes a major allocator of investment funds. To succeed in creating stable, progressively-oriented industries in a region within a capitalist economy, there must be cushions for firms against downturns and sectoral shifts, mechanisms for the creation of cutting edge technologies, and a commitment to reallocate investment to key industries. Otherwise the forces of uneven development, spatially and sectorally, will tend to prevail. While the models developed by Sweden and Mondragon hold promise, this approach requires a major political commitment to the region, and a willingness to embrace some of the vagaries of international capitalism.