Learning in the Village Economy of Denmark. The Role of Institutions and Policy in Sustaining Competitiveness

43 Pages Posted: 28 Jan 1998

See all articles by Peter Maskell

Peter Maskell

Copenhagen Business School (CBS)

Abstract

The benefits of an international division of labour is never illustrated more clearly than in small developed nations like Denmark. Without many natural resources such countries can never be self sufficient and they need access to foreign markets in order for their firms to specialise and utilize economics of scale. The specialisation chosen is mainly in low-tech goods, where the risk of sudden domestically damaging changes in technology or demand are relatively small. Besides such general features of small developed nations, the Danish case has some special characteristics, which distinguishes it from many other nations and regions. One important feature is the century-old, deep-rooted egalitarian beliefs of the society which during the last century has intermixed with the growth of the public sector in shaping not only the welfare state, but also a strongly consensus-seeking political system - the negotiated economy - incorporating all major groups in the economy. Recently, the development towards a knowledge based world economy has increased the importance of another feature with an small egalitarian country: the kind of trust-relations, that come into existence, when everyone in an industry has known everybody else through many years. The international industrial competitiveness of the country's vast majority of small, export oriented firms are not only favoured by a reasonable adequate macro-economic policy but further enhanced by the ease in the exchange of information resulting from established trust-relations.

JEL Classification: O14, O17

Suggested Citation

Maskell, Peter, Learning in the Village Economy of Denmark. The Role of Institutions and Policy in Sustaining Competitiveness. Available at SSRN: https://ssrn.com/abstract=54544 or http://dx.doi.org/10.2139/ssrn.54544

Peter Maskell (Contact Author)

Copenhagen Business School (CBS) ( email )

Howitzvej 60, 6
Danish research Unit for Industrial Dynamics (DRUID)
DK-2000 Frederiksberg
Denmark
+45 3815 2881 (Phone)
+45 3929 2226 (Fax)

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