My paper challenges this conventional wisdom with a systematic study of employer preferences in Germany, a paradigmatic CME and crucial ‘test case’ for VoC. It is based on interviews with key officials and an in-depth examination of a large-scale campaign founded and funded by German metalworking employers to shape public opinion, the New Social Market Initiative. This campaign originated in the center, not the periphery of German industry. It sheds insight on employers’ basic institutional orientations over time.
I find that German employers’ institutional preferences are considerably more liberal than VoC allows. Since the late-1990s, employers have pushed hard for a reduction of government expenditures; an expansion of market-oriented freedoms; and cuts to social protection, employment protection and benefit entitlements. The claim that employers opposed liberalization is untenable. Employers wanted to go farther than the Hartz reforms, but voters did not. I also find considerable variance over time. Initially, employers advocated far-reaching institutional change. During recent years, after extensive institutional softening, employers have sought to defend these reforms while large parts of the electorate sought to revert to the status quo ante.
