Australian Politics and Policy - Senior, 2019a

Government–business relations
revenue. For example, government agencies form part of the public sector and
are established by various Acts of parliament; their major source of funding is
tax revenues. Businesses form part of the private sector, are established, under
the relevant laws, through articles of association and the investment of private
funds to conduct commercial activity, and are funded by profits created through
the production and sale of goods and services. The civil society or not-for-profit
sector is funded by donations and gifts, and provides philanthropic, charitable or
welfare services that are not provided by government or business and are designed
to deliver some social benefit to members of the community.
In practice, the division between the three sectors is dynamic. Civil society
organisations, locally, nationally and globally, often seek funding from government
and business and may even enter into partnerships with the other sectors in
performing their role. In Australia, for example, the former Commonwealth
Employment Service, which provided job recruitment and search services for
employers and employees, was replaced by a competitive network of private and
civil society employment-sector providers (initially Job Network, then Job Services
Australia, known as Job Active since 2015). In this case, as in others, the delineation
betweenthethreesectorsisfarfromclear–thesectorstendtooverlapinterms
of funding sources and activities. Nevertheless, the underlying purposes of each
sector remain an important conceptual framework for understanding the capitalist
economic system as practised in nation-states. The various relationships between
the sectors differ depending on local values, interests, cultures and circumstances,
despite the homogenising effect often attributed to globalisation. 6
Levels of analysis
There are three main levels of analysis that are useful in understanding government–
business relations globally or within a nation-state. The macro level considers historical
institutional choices and preferences at the national level and provides a general
guide to the ‘proper’ role of the state in the market and in various sectors of the
economy. The meso level considers government–business relations at the industry or
sectoral level. This level of analysis is covered in detail in the sections on industry
policy and regulation below. The third level of analysis is the micro level, which
considers government–business relationships at the level of individual firms or
projects.
At the macro level, the different ways that capitalism is practised within nationstates
is often referred to as ‘varieties of capitalism’. 7 These differences stem from
the intersection of economic and political institutions within nation-states, where
institutions are defined as the formal and informal values, rules, routines and
6 Scholte 2008, 1476.
7 Hall and Soskice 2001.
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