Changing varieties of capitalism and revealed comparative advantages from 1990 to 2005: a test of the Hall and Soskice claims Martin R. Schneider 1,* and Mihai Paunescu 2 1 Faculty of Business Administration, Economics and Business Computing, University of Paderborn, Paderborn, Germany; 2 SAS, Vienna, Austria * Correspondence: martin.schneider@notes.upb.de In this paper, the varieties of capitalism (VoC) approach by Hall and Soskice (2001) is tested with longitudinal data and with measures covering all four institutional spheres differentiated in this approach. Among 26 OECD countries, we find various institutional configurations including a group of liberal market economies (LMEs) and of coordinated market economies (CMEs). However, these configura- tions are not stable. From 1990 to 2005, Denmark, Finland, the Netherlands and Sweden all moved from the CME model closer to the LME model. Capitalist variety is strongly linked to sector-specific comparative advantages, as predicted by Hall and Soskice—CMEs export more heavily in medium high-tech industries, and LMEs in high-tech industries. In addition, the economies that have moved towards the LME model have also specialized more strongly in high-tech over time. In sum, we find mixed evidence for the claims made by Hall and Soskice. Comparative advantages develop as predicted in the VoC approach, but the types of capitalism are more varied and more dynamic than the VoC approach suggests. Keywords: capitalism, varieties of, institutional change, technological change, trade JEL classification: P52 comparative studies of particular economies, F10 trade, O57 comparative studies of countries 1. Introduction The varieties of capitalism (VoC) approach (Soskice, 1997; Hall and Soskice, 2001) has become an influential version of the idea that sector-specific competi- tive advantages of companies and countries heavily depend on country-specific institutional conditions (Porter, 1990; Amable, 2003; Lundvall, 2007; Whitley, # The Author 2012. Published by Oxford University Press and the Society for the Advancement of Socio-Economics. All rights reserved. For Permissions, please email: journals.permissions@oup.com Socio-Economic Review (2011) 1–23 doi:10.1093/ser/mwr038 Socio-Economic Review Advance Access published February 6, 2012 by guest on November 10, 2014 http://ser.oxfordjournals.org/ Downloaded from