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This paper provides a comparative analysis of training regimes in Germany and the Netherlands. Both countries are CMEs with similar institutions, but their training regimes differ in important ways. The paper first maps the similarities and differences in the training regimes in both countries and then turns to three questions that frame the analysis of these similarities and differences. First, how have skills regimes adjusted to changes in economic and employment structure, such as de-industrialization and the rise of the service economy? Second, how much does the structure and adaptability of the raining regime help to explain the relative success of the Dutch employment miracle? Does the Dutch training regime represent successful institutional adaptation to changed economic circumstances? Conversely, does the inflexibility of the training regime contribute to the German employment malaise? Finally, what do these findings suggest for the analysis of the political economy of skills regimes in other CMEs?
Is there a "winner-take-all" politics in the affluent democracies of Northern Europe? We explore this question through a comparison of two cases of "regulated capitalism," Sweden and Germany, asking whether these institutions continue to produce equitable outcomes in the face of globalization and financial crisis. Both countries have experienced significant increases in income inequality since 1990, and their labor markets have begun to display signs of dualism, demonstrating the weakened capacity of regulated capitalism to secure equality. Despite these broad similarities, inequality and labor market dualism have increased more in Germany than in Sweden. We argue that the shift to the right, even among social democratic parties, is an important cause of increased inequality in both countries. Our analysis also emphasizes the political effects of decades of welfare state building in both countries: the popularity of the welfare state and other institutions of regulated capitalism among the electorate constrain the ability of governments to pursue a radical liberalization agenda. We attribute Sweden’s superior performance relative to Germany in protecting low income groups to the interaction of industrial relations institutions and the electoral system. Swedish corporatism has retained much of its encompassingness compared to Germany, and proportional representation in Sweden creates incentives for the Center-Left to include the interests of low-income groups in their electoral and governing strategies. In contrast, German industrial relations are increasingly marked by segmentalism, and the electoral system generates few incentives for the Center-Left to include low income groups in their electoral coalition.