The stagflation crisis and the European automotive industry, 1973-85 Jordi Catalan (Universitat de Barcelona) The dissemination of Fordist techniques in Western Europe during the golden age of capitalism led to terrific rates of auto production growth and massive motorization. However, since the late 1960s this process showed signs of exhaustion because demand from the lowest segments began to stagnate. Moreover, during the seventies, the intensification of labour conflicts, the multiplication of oil prices and the strengthened competitiveness of Japanese rivals in the world market significantly squeezed profits of European car assemblers. Key companies from the main producer countries, such as British Leyland, FIAT, Renault and SEAT, recorded huge losses and were forced to restructure. The degree of success in coping with the stagflation crisis depended on two groups of factors. On the one hand, successful survival depended on strategies followed by the firms to promote economies of scale and scope, process and product innovation, related diversification, internationalization and, sometimes, changes of ownership. On the other hand, firms benefited from long-term path-dependent growth in their countries of origin’s industrial systems. Indeed, two of the main winners of the period, Toyota and Volkswagen, can rightly be seen as outstanding examples of Confucian and Rhine capitalism. Both types of coordinated capitalism contributed to the success of their main car assemblers during the stagflation slump. However, since then, global convergence with Anglo-Saxon capitalism may have eroded some of the institutional bases of their strength. Keywords: Crisis; automobile industry; Rhine capitalism; Confucian capitalism 1. The end of the golden age According to a vast number of historians and economists, the long phase of growth in the period 1950-73 is considered to be the golden age of capitalism. In particular, Angus Maddison pointed out that global recessions (defined as a fall in real GDP) became increasingly rare in advanced economies. By analysing the history of slumps for a sample of sixteen leading OECD brought to you by CORE View metadata, citation and similar papers at core.ac.uk provided by Diposit Digital de la Universitat de Barcelona