Print Сite this

Two Models of Political Economy

Societies have long been searching for the most efficient relationship between the state and the market, which is reflected in different models of political economy. Nevertheless, it is important to understand that the world evolves rapidly, and some features, even the core ones, of the concepts of political economy may change over time. Therefore, the historical context should be considered when choosing one of the existing models. In terms of political economy strategies, the Western world has traditionally been divided into two prevalent concepts – the Anglo-American model and the continental European one.

We will write a
custom essay
specifically for you

for only $16.05 $11/page
308 certified writers online
Learn More

The Anglo-American model has long been considered a highly productive system in purely economic terms. De Girolamo (2018) states that it emphasizes flexibility, deregulation, and personal motivation as the main components of rapid economic growth, which is considered to be the cornerstone of any nation’s well-being. Nevertheless, it can be true when the middle class constitutes the largest part of the population and when the competition is not undermined by monopoles. Currently, the ongoing deindustrialization processes in both the US and the UK exacerbate the issues of stagnating middle-class incomes. Big tech companies and the owners of overseas factories have virtually altered the way the nation generates money and distributes it. There are a few ways modern small businesses can compete with the tech giants and workers in poorer countries. Therefore, the bond between democracy (based on the middle class and entrepreneurs) and the economic system has been disrupted.

The political economy of the European states, which have long been collecting enormous taxes to fund numerous wars and lavish lifestyles of their monarchs, have changed significantly with the establishment of a market economy. Countries such as France and Germany pioneered the concept of social welfare as the government’s responsibility. The population, which was already accustomed to the tax burden suddenly began to enjoy proper education, health care, and unemployment benefits. Moreover, the quality and quantity of all these aspects of social well-being grew at the same rate as the GDPs of their countries. It is hard to predict which of the models will prove to be more effective in the long run. Nevertheless, it has become vivid that the Continental model currently ensures more sustainable development of society as a whole. Moreover, it successfully resists the ever-growing stakeholder’s pressure, which is alien to the original concept of the “social market.”


De Girolamo, P. (2018). Financial globalization and the Anglo-Saxon model of Capitalism: An agency-centered approach to study financial change. Studia Politica. Romanian Political Science Review, 18(4), 613–629.

Cite this paper

Select style


StudyCorgi. (2022, May 7). Two Models of Political Economy. Retrieved from


StudyCorgi. (2022, May 7). Two Models of Political Economy.

Work Cited

"Two Models of Political Economy." StudyCorgi, 7 May 2022,

* Hyperlink the URL after pasting it to your document

1. StudyCorgi. "Two Models of Political Economy." May 7, 2022.


StudyCorgi. "Two Models of Political Economy." May 7, 2022.


StudyCorgi. 2022. "Two Models of Political Economy." May 7, 2022.


StudyCorgi. (2022) 'Two Models of Political Economy'. 7 May.

This paper was written and submitted to our database by a student to assist your with your own studies. You are free to use it to write your own assignment, however you must reference it properly.

If you are the original creator of this paper and no longer wish to have it published on StudyCorgi, request the removal.