Ideology, Institutions and Strategy in Party-Firm Relations: Quantitative Studies of Australia, Canada and Germany

There is virtually no systematic cross-national research on relations on party-firm relations. This paper approaches the subject through the study of the political contributions of 960 firms in Australia, Canada and Germany. Institutional variation does little to explain the differences between the countries. By contrast, the ideological distance between the principal competitors in each party system provides a more convincing explanation. Institutional variation is a less convincing explanation. In Canada, there was little ideological difference between the Progressive Conservatives and Liberals. This allowed the dominance of pragmatic behaviour, including widespread hedging by making payments to both parties. The distance between the Liberal-National Coalition and Australian Labor Party is more significant. Although firms react to changes in power they tend to plump for one party or the other, rather than hedging. In Germany, the later reform of the Social Democratic Party underpins a more ideological basis for party-firm relations. Hedging and payments to the left are rare and strongly associated with left-wing government.