The Developmental State in Developed Societies: Power, Partnership, and Divergent Patterns of Intervention in France and Finland

While the state continues to play a prominent role in the literature on developing countries, its absence in the work on advanced, industrialized societies is equally conspicuous. This article examines what happens to developmental states as they mature by analyzing the evolution of two, similar, statist societies, France and Finland. In contrast to recent literature on state-led or state-enhanced capitalism, we identify two responses to contemporary challenges. The French “marketizing state” used a combination of coercion and compensation to increase market competition, whereas the Finnish “investment state” targeted productivity-enhancing collective goods. We attribute these divergent responses to the structure of the postwar developmental state.