Anglo-Saxon economy
Encyclopedia
An Anglo-Saxon economy or Anglo-Saxon capitalism (so called because it is supposedly practiced in English-speaking countries such as the United Kingdom
, the United States
, Canada
, New Zealand
, Australia
and the Republic of Ireland
) is a capitalist
macroeconomic model in which levels of regulation and taxes are low, and government provides relatively fewer services.
) world originated from the standard French idea of le monde anglo-Saxon. The term refers to a particular culture which strongly features capitalism
and Protestantism
. A link between Protestantism and capitalism was described by Max Weber
in his observation of 19th century Germany, The Protestant Ethic and the Spirit of Capitalism
.
A common usage of "Anglo-Saxon" in the English-language media relates either to the language
spoken in the area which would become England, or the people of these areas
, after the arrival of Germanic tribes, primarily Angles
and Saxons
, in the 5th century. This usage is not linked to the use of "Anglo-Saxon" to refer to modern economic models.
" and free-market-oriented than other capitalist economies. However, those who disagree with the use of the term claim that the economies of the Anglosphere differ as much from each other as they do from continental European economies.
Differences between Anglo-Saxon economies are illustrated by taxation and the welfare state
. The UK has a significantly higher level of taxation than the US. Moreover, the UK spends far more than the US on the welfare state as a percentage of GDP and also spends more than Spain, Portugal, or the Netherlands, all of which are in mainland Europe. This spending figure is however still considerably lower than that of France or Germany.
Most countries on continental Europe
(such as France
, Italy
and Germany
) possess a macroeconomic model called continental capitalism (also called Rhine or Rhenan capitalism
). Yet some see Spain and also the newer members of the EU as (non-English-speaking) examples of "Anglo-Saxon" economies. The debate amongst economists as to which economic model is better, circles around perspectives involving poverty, job insecurity, social services, and inequality. Generally speaking, their advocates argue that more liberalised economies produce greater overall prosperity, while defenders of continental models counter that they produce lesser inequality and lesser poverty at the lowest margins.
United Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...
, the United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
, Canada
Canada
Canada is a North American country consisting of ten provinces and three territories. Located in the northern part of the continent, it extends from the Atlantic Ocean in the east to the Pacific Ocean in the west, and northward into the Arctic Ocean...
, New Zealand
New Zealand
New Zealand is an island country in the south-western Pacific Ocean comprising two main landmasses and numerous smaller islands. The country is situated some east of Australia across the Tasman Sea, and roughly south of the Pacific island nations of New Caledonia, Fiji, and Tonga...
, Australia
Australia
Australia , officially the Commonwealth of Australia, is a country in the Southern Hemisphere comprising the mainland of the Australian continent, the island of Tasmania, and numerous smaller islands in the Indian and Pacific Oceans. It is the world's sixth-largest country by total area...
and the Republic of Ireland
Republic of Ireland
Ireland , described as the Republic of Ireland , is a sovereign state in Europe occupying approximately five-sixths of the island of the same name. Its capital is Dublin. Ireland, which had a population of 4.58 million in 2011, is a constitutional republic governed as a parliamentary democracy,...
) is a capitalist
Capitalism
Capitalism is an economic system that became dominant in the Western world following the demise of feudalism. There is no consensus on the precise definition nor on how the term should be used as a historical category...
macroeconomic model in which levels of regulation and taxes are low, and government provides relatively fewer services.
Origins of the term
The term Anglo-Saxon to denote the English-speaking (anglophoneEnglish-speaking world
The English-speaking world consists of those countries or regions that use the English language to one degree or another. For more information, please see:Lists:* List of countries by English-speaking population...
) world originated from the standard French idea of le monde anglo-Saxon. The term refers to a particular culture which strongly features capitalism
Capitalism
Capitalism is an economic system that became dominant in the Western world following the demise of feudalism. There is no consensus on the precise definition nor on how the term should be used as a historical category...
and Protestantism
Protestantism
Protestantism is one of the three major groupings within Christianity. It is a movement that began in Germany in the early 16th century as a reaction against medieval Roman Catholic doctrines and practices, especially in regards to salvation, justification, and ecclesiology.The doctrines of the...
. A link between Protestantism and capitalism was described by Max Weber
Max Weber
Karl Emil Maximilian "Max" Weber was a German sociologist and political economist who profoundly influenced social theory, social research, and the discipline of sociology itself...
in his observation of 19th century Germany, The Protestant Ethic and the Spirit of Capitalism
The Protestant Ethic and the Spirit of Capitalism
The Protestant Ethic and the Spirit of Capitalism is a book written by Max Weber, a German sociologist, economist, and politician. Begun as a series of essays, the original German text was composed in 1904 and 1905, and was translated into English for the first time by Talcott Parsons in 1930...
.
A common usage of "Anglo-Saxon" in the English-language media relates either to the language
English language
English is a West Germanic language that arose in the Anglo-Saxon kingdoms of England and spread into what was to become south-east Scotland under the influence of the Anglian medieval kingdom of Northumbria...
spoken in the area which would become England, or the people of these areas
Anglo-Saxons
Anglo-Saxon is a term used by historians to designate the Germanic tribes who invaded and settled the south and east of Great Britain beginning in the early 5th century AD, and the period from their creation of the English nation to the Norman conquest. The Anglo-Saxon Era denotes the period of...
, after the arrival of Germanic tribes, primarily Angles
Angles
The Angles is a modern English term for a Germanic people who took their name from the ancestral cultural region of Angeln, a district located in Schleswig-Holstein, Germany...
and Saxons
Saxons
The Saxons were a confederation of Germanic tribes originating on the North German plain. The Saxons earliest known area of settlement is Northern Albingia, an area approximately that of modern Holstein...
, in the 5th century. This usage is not linked to the use of "Anglo-Saxon" to refer to modern economic models.
Disagreements over meaning
Proponents of the term Anglo-Saxon economy state that Anglo-Saxon economies are more "liberalEconomic liberalism
Economic liberalism is the ideological belief in giving all people economic freedom, and as such granting people with more basis to control their own lives and make their own mistakes. It is an economic philosophy that supports and promotes individual liberty and choice in economic matters and...
" and free-market-oriented than other capitalist economies. However, those who disagree with the use of the term claim that the economies of the Anglosphere differ as much from each other as they do from continental European economies.
Differences between Anglo-Saxon economies are illustrated by taxation and the welfare state
Welfare state
A welfare state is a "concept of government in which the state plays a key role in the protection and promotion of the economic and social well-being of its citizens. It is based on the principles of equality of opportunity, equitable distribution of wealth, and public responsibility for those...
. The UK has a significantly higher level of taxation than the US. Moreover, the UK spends far more than the US on the welfare state as a percentage of GDP and also spends more than Spain, Portugal, or the Netherlands, all of which are in mainland Europe. This spending figure is however still considerably lower than that of France or Germany.
Most countries on continental Europe
Europe
Europe is, by convention, one of the world's seven continents. Comprising the westernmost peninsula of Eurasia, Europe is generally 'divided' from Asia to its east by the watershed divides of the Ural and Caucasus Mountains, the Ural River, the Caspian and Black Seas, and the waterways connecting...
(such as France
France
The French Republic , The French Republic , The French Republic , (commonly known as France , is a unitary semi-presidential republic in Western Europe with several overseas territories and islands located on other continents and in the Indian, Pacific, and Atlantic oceans. Metropolitan France...
, Italy
Italy
Italy , officially the Italian Republic languages]] under the European Charter for Regional or Minority Languages. In each of these, Italy's official name is as follows:;;;;;;;;), is a unitary parliamentary republic in South-Central Europe. To the north it borders France, Switzerland, Austria and...
and Germany
Germany
Germany , officially the Federal Republic of Germany , is a federal parliamentary republic in Europe. The country consists of 16 states while the capital and largest city is Berlin. Germany covers an area of 357,021 km2 and has a largely temperate seasonal climate...
) possess a macroeconomic model called continental capitalism (also called Rhine or Rhenan capitalism
Rhine Capitalism
Rhine capitalism or Rhenish capitalism is a contemporary economic order existing primarily in Western Europe. The term originates from the French economist and Chairman of the Board and CEO Assurances Générales de France , Michel Albert who first used it in his book Capitalisme contre Capitalisme...
). Yet some see Spain and also the newer members of the EU as (non-English-speaking) examples of "Anglo-Saxon" economies. The debate amongst economists as to which economic model is better, circles around perspectives involving poverty, job insecurity, social services, and inequality. Generally speaking, their advocates argue that more liberalised economies produce greater overall prosperity, while defenders of continental models counter that they produce lesser inequality and lesser poverty at the lowest margins.