Anglo-Saxon economy

Anglo-Saxon economy or Anglo-Saxon capitalism (so called because it is supposedly practiced in English-speaking countries such as the United Kingdom, the Republic of Ireland, the United States, Canada, New Zealand and Australia) is a capitalist macroeconomic model in which levels of regulation and taxes are low, and government provides relatively fewer services. In addition, Anglo-Saxon economies are stated to be more 'liberal' and free-market oriented than other capitalist economies in the world by proponents of the term. One major point of criticism is that the economies of the Anglosphere differ as much from each other as they do from continental European economies. The British welfare state, for example, is more comparable to that of the Netherlands, Portugal or Spain than it is to the United States.

Most countries on continental Europe (such as France, Italy and Germany) possess a macroeconomic model called continental capitalism (also called Rhenan capitalism). Yet, some such as Katinka Barysch, see Spain and Portugal as examples of "Anglo-Saxon" economies. The debate amongst economists as to which economic model is better, circles around perspectives involving poverty, job insecurity, social services, and inequality. Generally speaking, their advocates argue that more liberalised economies produce greater overall prosperity, while defenders of continental models counter that they produce lesser inequality and lesser poverty at the lowest margins.

Disagreement over meaning
The term Anglo-Saxon to denote the English-speaking world originated from the standard French idea of le monde anglo-saxon. The term refers to a particular culture in which capitalism and protestantism (in the case of the UK, some form of Anglicanism) are the main elements leading to a particular socio-economic culture. A link between protestantism and capitalism was described by Max Weber in his observation of 19th century Germany, entitled The Protestant Ethic and the Spirit of Capitalism.

A common usage of "Anglo-Saxon" in the English-language media relates either to the language spoken in the area which would become England, or the people of these areas, after the arrival of Germanic tribes, primarily Angles and Saxons, in the 5th century. This usage has only tenuous links at best with the use of "Anglo-Saxon" to refer to modern economic models.

The relevance of the concept of the "Anglo-Saxon economy" is controversial. The UK has a higher level of taxation than the US and spends far more on the welfare state as a percentage of GDP. For example the UK spends 21.8% of GDP on welfare and state-funded healthcare, significantly lower than France or Germany, but still higher than Spain, Portugal, or the Netherlands, all in mainland Europe, and far higher than the USA's 14.8%.

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