THE TERM associative state describes a particular kind of partnership between firms and the government. In an associative state, the government promotes techniques of administrative management to rationalize production and distribution in industry. Firms and government cooperate to reshape the self-interest of industrialists to accord more closely with the public interest, in order to guarantee economic growth.

The idea of associationalism was first developed by Herbert Hoover as Secretary of Commerce in the 1920s. By rejecting the liberal model of laissez-faire, Hoover encouraged the formation of trade associations for the exchange of information about materials, production, and marketing that would have allowed corporations to contain prices while eliminating costly competition. As an engineer dedicated to efficiency, Hoover considered many aspects of competition among companies as wasteful, ...

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