The polder model is a term with uncertain origin that was first used to describe the internationally acclaimed Dutch version of consensus policy in economics, specifically in the 1980s and 1990s. However, the term was quickly adopted for a much wider meaning, for similar cases of consensus decision-making, which are supposedly typically Dutch. It is described with phrases like 'a pragmatic recognition of pluriformity' and 'cooperation despite differences'.
A popular explanation of both the term and the reason this decision-making style works so well in the Netherlands is the unique situation created by the fact that a large part of the country consists of polders below sea-level. Ever since the Middle Ages, competing or even warring cities in the same polder were forced to set aside their differences to maintain the polders, lest they both be flooded.
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The Dutch polder model is characterised by the tri-partite cooperation between employers' organizations such as VNO-NCW, labour unions such as the Federation Dutch Labour Movement, and the government. These talks are embodied in the Social Economic Council (Dutch: Sociaal-Economische Raad, SER). The SER serves as the central forum to discuss labour issues and has a long tradition of consensus, often defusing labour conflicts and avoiding strikes. Similar models are in use in Finland, namely Comprehensive Income Policy Agreement and universal validity of collective labour agreements.
The current polder model is said to have begun with the Wassenaar Accords of 1982 when unions, employers and government decided on a comprehensive plan to revitalise the economy involving shorter working times and less pay on the one hand, and more employment on the other. This polder model, combined with a neo-liberal economic policy of privatisation and budget cuts has been held to be responsible for the Dutch economic miracle of the late 1990s.
An important role in this process was played by the Dutch Central Planning Bureau [1] (CPB) originally founded by Jan Tinbergen. The CPB's policy advice since 1976, in particular with the Den Hartog and Tjan model, in favour of wage restraint, was an important argument, supportive for government and employers, that the unions could not easily counter.
The word polder model and especially the verb "polderen" (English: to polder) has been used pejoratively by some politicians to describe the slow decision making process, where all parties have to be heard. The model flourished under the 'Purple' governments of Dutch prime minister Wim Kok, a coalition including traditional rivals the Labour Party (a social-democratic party, whose colour is red) and the People's Party for Freedom and Democracy (right-wing liberals, whose colour is blue). In the declining economic climate of the early 21st century the model came under fierce attack from particularly right-wing politician Pim Fortuyn and his book "De puinhopen van 8 jaar paars" ("The wreckage of eight years of purple").
Somewhat ironically, there is no consensus about the exact historical background of the polder model. In general there are three views on this subject.
One explanation points to the rebuilding of the Netherlands after the Second World War. Corporatism was an important feature of Christian Democratic, and particularly Catholic, political thought. After the Second World War, the Catholic, Protestant, Christian, social-democratic and liberal parties decided to work together to reconstruct the Netherlands after the ravages of war, as did their unions and employers' organisations. Important institutes, like the SER, of the polder model were founded in this period. No single political party has ever had anything approaching an overall majority in parliament, so coalition government is inevitable. This makes parties extremely cautious, today's enemy may be tomorrow's ally. Even more in present times when the death of ideology has made it possible for almost all the parties to work together.
Another explanation points to the dependency of the Netherlands on the international economy. The Dutch cannot afford protectionism against the unpredictable tides of the international economy, because it is not an autarkic economy. Therefore to cushion against the international economy, the Dutch set up a tri-partite council which oversaw an extensive welfare state.
A third explanation refers to a unique aspect of the Netherlands, largely consisting of polders, land regained from the sea, which requires constant pumping and maintenance of the dykes. So ever since the Middle Ages, when this was started, different societies living in the same polder were forced to cooperate because without unanimous agreement on shared responsibility for maintenance of the dikes and pumping stations, the polders would have flooded and everyone would have suffered. Crucially, even when different cities in the same polder were at war, they still had to cooperate in this respect. This is thought to have taught the Dutch to set aside differences for a greater purpose.