Translation has received very little attention in economics. Existing contributions can first be arranged in two main categories as follows:

DESCRIPTIONS, backed up by more or less extensive quantitative data, of translation as an economic sector; the quantitative information, which is usually arranged by target language or by country, variously contains estimates of:

— the number of persons involved in the profession;

— the annual turnover of more or less narrowly defined translation services;

— the volume of output (words, pages, etc.).

Such descriptions are usually not produced by (academic) economists and are generally due to professional associations.

ANALYTICAL WORK providing theory-based explanations of some aspect or other of translation perceived as a “product” in the economic sense of the term. This work is more likely to be due to academic economists, although some contributions have come from scholars in sociology or in the language disciplines, who have adopted an economic perspective in their research on translation.

The expression “analytical work” should also be understood in a broad sense, encompassing both strictly theoretical work (usually in the form of algebraic modelling, with a focus on investigating the nature of the relationships between variables) and empirical work, in which statistical data are used to test the propositions generated by theoretical models.

Here we summarise the results corresponding to the following questions: 1) the status of translators in the various census, taxation and job-description systems. 2) the relative status of academic qualifications and training, 3) the status of sworn or authorised translators, and 4) the role of professional associations.

These results are followed by a series of case studies, where the four questions are answered in terms of more or less unified national signalling systems.

What is the Status of Translators in Official Categorisations?

General classifications of economic activities

In the “Statistical Classification of Economic Activities in the European Community” (NACE) we find “Translation and Interpretation” listed as a separate category (74.3), alongside “Specialised design activities”, “Photographic activities” and “Other professional, scientific and technical activities”. This classification is picked up in some of the national listings (in Croatia, Poland, Portugal and the United Kingdom, for example) and in principle should apply throughout the European Union.

The International Labour Organization has an International Standard Classification of Occupations (ISCO-88) in which translators and interpreters are categorised in major group 2 “professionals”, sub-major group 24 “other professionals”, minor group 244 “social science and related professionals” and unit group 2444 “philologists, translators and interpreters”. This classification has been reported as being used in Austria.

The focus of this study is mainly on the more traditional signalling systems, the ones attached in some way to political states. It would be naive, however, to overlook the reasons why new systems are developing, notably through Internet technologies.

Informants in various countries, especially in central Europe, report that translators are receiving information and networking less through national associations and more through online sites. Some sites, like LinkedIn and Facebook, provide social networking. Other sites, however, provide an additional range of services for translators and basically function as marketplaces where clients can find translators. Here we review the way status is constructed in the main sites, presented in order of claimed number of translators.

ProZ

Founded in New York in 1999, ProZ.com claims to have “over 300,000 professional translators and translation companies” in 2011. Anyone can sign up for free, but full membership costs US$129 a year. Since the huge number of “translators” listed (i.e. everyone who has signed up for free) would seem to exceed market demands, there must be doubts that all the translators have the same professional status. ProZ has been particularly innovative in the development of signalling devices, which come with their own names-for-things. Members ask questions about translation problems, and when a member answers a question satisfactorily, they gain kudos (or KudoZ) points; the number of points accumulated thus signals relative expertise.

The basic recommendation is that attempts should be made to improve the mechanisms by which the status of translators is signalled, building on the work that has been done by the EMT and Optimale initiatives. This is in view of the many areas in which the current signals of status are not working optimally.

While it is not the task of this study to propose policy, any action in this field should pay some heed to the following criteria and desiderata:

1. 1. It should address the many paraprofessionals who are translating and interpreting many “immigrant” languages.

2. This implies that a certification system, for example, should have several different levels and types of certification, including a level for segments and languages where little training can be required because the demand far exceeds the supply of trained translators. Translation and interpreting services for the provision of justice in immigrant languages is an area where public policy is scandalously absent in the European Union.

3. 2. It should involve more than the official languages of the European Union.

4. This concerns not just “immigrant” and “non-territorial” languages, but also the languages of the major trading partners.

5. 3. In principle, it should be as lean as possible and paid for by the main direct beneficiaries.

6. This implies recognising that status is a commodity, with a market value. Public funds should be invested only to the extent that public administrations are themselves long-term beneficiaries.

7. 4. It should seek to ensure cross-border recognition of qualifications and certifications.

8. […]

European monetary integration rests on a convergence of views across different countries related to the virtues of stable money and sound finances. This convergence has operated under many different justifications. It was the logical response to the liberalization of international financial markets; it was the price for German participation; and it was the hegemony of neo-liberalism in the battle of ideas. No matter how they explained it, most observers agreed on the existence of a Brussels–Frankfurt consensus underpinning Europe's single currency.

Then the consensus began to falter. The first cracks appeared during the crisis surrounding the stability and growth pact (SGP) in the early 2000s. The tensions mounted with the widening divergence in inflation rates across Eurozone countries and the increasingly volatile euro–dollar exchange rate during the middle of the decade. The consensus shattered completely as the ECB struggled first to manage the global economic and financial crisis and then was found to be responsible for the stabilization of European sovereign-debt markets. Now, the German economics community is openly discontent with the ECB; the ECB and the European Commission are promoting different agendas; and the member states are clearly divided as to what should be the solution.

This chapter explains the collapse of the Brussels–Frankfurt consensus. The argument echoes the main themes of this volume. To the extent that it existed, the ideational consensus underpinning Europe’s single currency was always more rhetoric than reality. The main economic actors couched their policies in the language of sound money and stable finances (or free markets and neutral states); however, they actually behaved more pragmatically than ideologically, and they showed a remarkable willingness to break their own rules.

Introduction

One of the most significant developments in economic theory in recent decades is the emergence of a neo-liberal approach to governing the firm, which has become commonly known as the ‘shareholder’ or the ‘shareholder-value’ model. This approach, which is based on the conceptionalization of the firm as a set of contracts between ‘principals’ and ‘agents’, has achieved a dominant position in academic thinking and policy making in the field of corporate governance at the EU level. Most advocates of this approach do not explicitly identify themselves as neo-liberals; nevertheless, the tenets of this approach clearly fit the definition of neo-liberalism offered in the first chapter of this book. The shareholder model is based on a strong faith in the efficiency of markets because it claims that a properly functioning stock market can best measure the value of firms and efficiently allocate capital to the most profitable investment projects. Furthermore, the stock market is a key element in creating a ‘market for corporate control’, which allows ownership and management of underperforming firms to be transferred – if necessary, against the will of incumbent managers and employees – to actors that will restructure the firm to increase efficiency. The shareholder model of governance, it is argued, has positive welfare effects for stakeholders in the firm (including employees) and, therefore, for society as a whole.

In contrast with laissez-faire approaches to corporate governance, the shareholder model accepts the need for a strong state role in setting and enforcing rules to enable the stock market to function properly. In particular, so-called minority shareholders (i.e., those shareholders holding relatively small proportions of stock in a company) must be protected from a host of actors that might exploit information or power advantages to extract value from the firm in their own interests. The shareholder model also contrasts with the broad class of ‘stakeholder’ theories, which value worker participation, state-led industrial policy, and (more recently) environmental protection.

When Keynes wrote these lines, he certainly had in mind the influence of the ideas of laissez-faire economic liberalism, which he held responsible for the great boom and bust of the 1920s that led to the Great Depression of the 1930s. Today, another form of economic liberalism, neo-liberalism, has supplanted Keynes's own ideas, which had gained dominance in the postwar era. Our task, in this theoretical essay, is to explain how and why the ideas of neo-liberal economists and political philosophers obtained and retained their power in European policy debates and political discourse during the past three or four decades.

We define ‘neo-liberalism’, at its essence, as involving a commitment to certain core principles focused on market competition and a limited state. Our purpose is to explain the resilience of these core neo-liberal ideas, meaning their ability to endure, recur, or adapt over time; to predominate against rivals; and to survive despite their own many failures. We offer five lines of analysis as potential explanations for such resilience: first, the generality, flexibility, and mutability of neo-liberal ideas themselves; second, the gap between neo-liberal rhetoric and a reality in which they are not implemented; third, their advantages in policy debates and political discourse compared with alternatives; fourth, the power of interested actors who strategically adopt and promote neo-liberal ideas; and, fifth, the force of the institutions in which neo-liberal ideas are embedded.

Introduction

What has been the influence of the neo-liberal ideology on welfare-state transformations since the 1980s? How resilient is such ideology and what is its influence today – that is, in the early 2010s? In the context of this book's themes, we would expect to find in this policy area a high degree of influence and resilience. After all, neo-liberalism emerged as an attack on Big Government, with a view to rescuing individual freedom from the torments of taxation, bureaucracy, and regulation (including in the social realm). This chapter recognizes the high relevance (and not only rhetorical) of neo-liberalism for welfare-state developments since the 1980s – but with two decisive qualifications. The first has to do with meanings: gauging neo-liberal resilience requires a prior clarification of what is connoted by the term ‘neo-liberalism’. The second qualification has to do with timing: I argue that the influence of neo-liberalism on the welfare state has followed a broad parabola, which reached its peak in the early 1990s but started to decline thereafter in the wake of ideological changes and discursive reorientations.

I start with the meaning attributed to the term ‘neo-liberalism’ and, more precisely, to both the noun (liberal) and the prefix (neo). Unfortunately, the English language conflates in the noun three connotations that Italian (and Italy's political-theory tradition) separates by using different nouns. The Italian language, in fact, distinguishes among liberalesimo, liberalismo, and liberismo. The first term has the widest connotation: It refers to the entire, complex, and diverse thought tradition that began with the philosophical contractualism of John Locke and with the doctrines about the constitutional protection of individual freedoms. Liberalesimo thus embraces the entire range of offspring that ‘germinated’ from the Lockean core: its outer perimeter ends where authoritarianism and collectivism begin and the ideas of negative freedom, its constitutional protection, and its lexicographic primacy are rejected.

Introduction

It is difficult to find an account of the ‘neo-liberal’ decades since 1980 that does not reserve a special place for unshackled financial markets. This is true not only for the United States but also for the European economies that are the focus of this volume and chapter. Critics commonly portray globalized and deregulated finance as the lynchpin of the neo-liberal economic order. International capital mobility has shifted the balance of power in favour of capital at the expense of labour, so the argument goes. Furthermore, credit institutions let loose have eased the pain of growing income inequality by showering unsustainable credit on households across the OECD world. These policies have been inspired or, at least, justified by neo-liberal ideas about financial markets and their regulation: that markets can ensure an efficient distribution of capital and financial services and that governments should either promote such efficiency through market-enhancing regulation and the enforcement of competition or take a hands-off approach altogether.

In the panoply of ideas about state–market relations, ideas about finance occupy a special place. Textbooks in the field emphasize individual rationality and efficiency and portray wholesale finance as quintessential markets: liquidity is high, information asymmetries and transaction costs are low, and equal assets have equal prices around the world. Because of their virtual character, contemporary financial markets have lent themselves to the practical application of abstract economic ideas more than other societal domains. That makes neo-liberal ideas powerful in contemporary finance but also vulnerable: in the event of a crisis, we can expect these ideas to attract much of the blame rather than exogenous material factors, such as adverse weather conditions in case of a famine or demographic change causing strains in pension systems.

Although, when viewed from afar, Europe may appear to be a haven of Social Democracy, strongly opposed to economic liberalism, closer analysis reveals that the place of ‘neo-liberal’ economic ideas in policy debates has grown steadily since the 1980s. Such ideas which, most simply stated, centre on extending market competition while limiting the state, have had a profound influence on the institutions, policies, and practices of capitalism across different European countries as well as in the European Union (EU). Neo-liberal ideas have continued to dominate policy debates through Europe's economic and political booms and busts.

This resilience of neo-liberal ideas is surprising. Europe offered a relatively ‘cold climate’ for economic liberalism in the 1970s, with well-entrenched alternative ideas based on Social and Christian Democracy – to say nothing of strong Marxist traditions. Powerful theoretical critiques have been made of neo-liberal ideas while policies inspired by neo-liberalism – such as allowing greater competition in financial markets, reducing regulation, and cutting back state spending and deficits even in economic downturns – have met with failure. The present difficulties of neo-liberalism can be contrasted with the past successes of alternative models, notably social democratic models. However, the greatest surprise came in the 2000s, first with the absence of any major re-evaluation of neo-liberal ideas about governing the markets in the face of the ‘dot-com’ boom and bust and then, even more significantly, with the economic crisis beginning in 2008. After a brief neo-Keynesian moment at the very inception of the crisis, far from abandoning neo-liberal ideas, European policy makers responded with calls for their extension. They accepted or even embraced ideas of reducing public expenditure, delegating greater powers to supranational bodies, increasing liberalization, and imposing ‘market discipline’ through austerity.

Introduction

Liberalism in Jane Austin's day was the great path for escape from the strictures of the British class system and for reward for individual effort and merit. Jane Austin's Persuasion is the ultimate ode to neo-liberalism: the wealthy heroine and the poor but ambitious hero are forced by her family to abort a youthful engagement. Yet, his later bourgeois success as a sea captain and consequent wealth permit love to triumph at last. Liberalism in this context is a revolutionary concept that empowers bourgeois strivers to challenge aristocratic prerogatives and to achieve by individual merit those goals denied to them by class constraints. More recently, liberalism as a political philosophy – dubbed ‘neo-liberalism’ – has had very different implications for social class: policies inspired by neo-liberal goals are frequently viewed as mechanisms to release individuals from the constrictions imposed by government rather than by class structure. These recent neo-liberal reforms often advantage actors in the marketplace who – by virtue of their class position or inherent capabilities – hold superior resources in exchange transactions. Whereas liberalism was once celebrated as a vehicle for levelling class inequities, policies of a neo-liberal hue (at least in some countries) have now become a driver of inequality.

This chapter reflects on the flexibility and ambiguity embedded in the neo-liberal ideal, and it comments on two questions and related lines of explanation raised in the first chapter of this volume. First, I ponder the utility of neo-liberalism as an independent variable and query whether the flexible, multifaceted nature of liberal political ideology contributes to its resilience or whether this inherent flexibility constrains its capacity for causal impact. Second, I reflect on neo-liberalism as a dependent variable by probing the factors that shape the diverse manifestations of this set of ideas across time and national settings.

Although Italy and France have seemingly little in common – given differences in economic profile, state capacity, leadership effectiveness, vulnerability to the economic crisis, and more – they both nevertheless can be categorized as part of a third variety of capitalism: state-influenced market economies (SMEs). In such political economies, the state intervenes more, for better or for worse, and differently than in liberal market economies like the United Kingdom and Ireland or in coordinated market economies like Germany and Sweden. However, what distinguishes these SMEs from other varieties of capitalism is not just their institutional configuration. Equally important are the underlying ideational legacies that underpin the institutions, shaping the ways in which actors have defined and remade markets and how they have engaged in ‘acting out change’ against a background of national traditions of economic thought, of state intervention, and of decades of lived economic practice. Postwar SMEs are distinguished from the other postwar varieties of capitalism by their very different stewardship of the economy through ‘non-liberal’ (defined as violating neo-liberal tenets) institutions of planning, industrial policy, and/or public enterprise. These in turn constituted historical legacies that left their traces even as the state liberalized from the 1980s onwards. In Italy, the country's ‘state-assisted’ capitalism, or ‘public neo-capitalism’, continued to ‘muddle through’ after the postwar years, leading at best ‘by indirection’ except at times when and/or in areas where technocratic elites took over. In France, political elites transformed the country's postwar non-liberal ‘state-led’ capitalism, or dirigisme, through the dirigiste retreat from dirigisme that resulted in the ‘post-dirigisme’ of the 1980s onwards.

Introduction

Within the literature on comparative capitalisms, Germany and Sweden are often perceived as paradigmatic cases of ‘coordinated market economies’, in which economic success has rested on non-market forms of organization. At the same time, coordination in the two countries is achieved in different ways through the Bismarkian or Nordic welfare-state traditions and the differential importance of sector versus national-level industrial relations. Likewise, both countries have undergone substantial liberalization in recent decades, reflecting attempts to open markets and transform the role of the state away from intervention and towards a neutral regulator of markets.

Neo-liberal ideas and discourse have had a role in these transformations in both countries despite the fact that both could be considered as least-likely cases for liberalization due to strong non-liberal institutions. In Sweden, neo-liberal ideas have obtained a surprising level of dominance in public debates; similarly, German policy makers have promoted the virtues of more liberal capital markets and emphasis on shareholder value. However, the recent financial crisis could be expected to shatter the relative strength of neo-liberal ideas and discourses, prompting a return to non-liberal forms of economic policy. This chapter argues that such a return to ‘non-liberalism’ has not taken place so far. Rather, neo-liberal ideas and discourse demonstrate a surprising resilience in the face of ‘real-world’ problems that could be understood to seriously challenge neo-liberal theories about the role of the state in the economy and the superiority of markets as a social-ordering principle.