[6] Edward Younkins, professor at Wheeling University, described democratic capitalism as a “dynamic complex of economic, political, moral-cultural, ideological, and institutional forces”, which serves to maximize social welfare within a free market economy.
[10][11] The growing critique of free-market capitalism and the rise of the notion of social justice in political debate contributed to the adoption of democratic capitalist policies.
[11] Officials requested international capital controls which would allow governments to regulate their economies while remaining committed to the goals of full employment and economic growth.
[1] Following the severe economic impacts of the war, working classes in the Western world were more inclined to accept capitalist markets in conjunction with political democracy, which enabled a level of social security and improved living standards.
[5] Policy developments were based on the rising notion that free markets required some state intervention to maintain them, provide structure, and address social inequities caused by them.
[11] Following the oil shocks of the 1970s and the productivity slowdown in the United States in the 1980s, politicians and voters maintained strong support for democratic capitalist policies and free markets.
[11] Publicly funded democratic capitalist policies were designed and implemented to compensate individuals negatively affected by major, structural economic change.
[11] In the 1980s, Organisation for Economic Co-operation and Development economies began reducing corporate taxation, though personal income taxes and public spending on social security programs generally remained stable.
[12] After taking office as president in 1981, Ronald Reagan advocated for a reduced role of government in the economy, while responding to voters’ skepticism of liberal capitalism by maintaining strong public sector spending.
[5] The Reagan administration maintained previous levels of government expenditure on Social Security and Medicare as a proportion of gross domestic product (GDP).
[4] The post-war implementation of democratic capitalism saw the expansion of welfare states and the free collective bargaining rights of employees, alongside market policies designed to ensure full employment.
[14] This includes institutions which facilitate bargaining between government bodies and business and labour organisations such as unions, and those which regulate the relationships between employees and management within private firms.
[14] The development of institutions to promote cooperation among public and private economic entities acknowledges the benefits of market competition, while attempting to address the social problems of unrestrained capitalism.
[14] Other policies which promote economic security include social insurance, and the fiscal financing of education and job training programs to stimulate employment.
[4] Competition laws are designed to regulate private sector activities, including the actions of capital asset owners and managers, in order to prevent outcomes which are socially undesirable according to the democratic majority.
[1] In particular, he comments that the accelerating inflation of the 1970s in the Western world can be attributed to rising trade-union wage pressure in labour markets and the political priority of full employment, both of which are synonymous with democratic capitalism.
[17] The papal encyclical Centesimus annus, written by Pope John Paul II, emphasizes a vision of a communitarian form of democratic capitalism.
[17] The encyclical stressed to decision makers the importance of the dignity of the person and a concern for the poor, while acknowledging the need to balance economic efficiency with social equity.
[17] Arrangements proposed included structures of accountability designed to involve all stakeholders, such as employees, customers, local communities, and wider society, in the corporate decision making process, as opposed to stockholders only.