What Is “Authoritarian” About Authoritarian Capitalism? The Dual Erosion of the Private–Public Divide in State-Dominated Business Systems

• Published in: Business & society 2021-07, Vol.60 (6), p.1312-1348
• Main Authors: Sallai, Dorottya, Schnyder, Gerhard
• Format: Article
• Language: English
• Subjects: Authoritarianism; Business; Capitalism; State capitalism; State intervention
• ISSN: 0007-6503; 1552-4205
• DOI: 10.1177/0007650319898475

The “return of the state” as an economic actor has left scholars at a lack of theoretical tools to capture the characteristics of state-dominated business systems. This is reflected in the fact that any type of state intervention in the economy is too easily qualified as a sign of “authoritarian capitalism,” which has led scholars to lump together countries as diverse as China, Singapore, and Norway under that heading. Rather than considering any type of state intervention in the economy as authoritarian, we propose a more sophisticated conceptualization, which distinguishes two boundaries between the public and the private domains and conceives of the “return of the state” as the erosion of one or both of them. This conceptualization allows us to clearly distinguish a shift from an ideal-typical market-based “regulatory capitalism” to “state capitalism” or “authoritarian capitalism,” respectively. We use interview data with business leaders in an extreme case of the return of the state to identify the nature of the mechanisms by which an authoritarian government erodes these private-public divides. We argue that a focus on these constitutive mechanisms of the erosion of private-public divides allows us to define “authoritarian capitalism” in a way that makes it a useful tool to understand contexts beyond the Chinese case in which it first emerged.