chapter  2
Business interests and the development of the Bismarckian welfare state
WithThomas Paster
Pages 26

31For political economists and economic historians, Germany has become something akin to a paradigm case of a country that combines economic competitiveness and social cohesion. Scholars inspired by the Varieties of Capitalism (VoC) approach emphasize how the institutional framework of production benefit those firms that rely on skilled workers (Hall and Soskice 2001). Specifically, some studies hypothesize that generous programs of social protection motivate workers to invest in what is known as ‘specific skills’, that is, skills that are of use only for particular firms or industries, and thus also benefit firms that rely on such skills (e.g., Estévez-Abe et al. 2001).