Investment preferences and patient capital: financing, governance, and regulation in pension fund capitalism

In comparative political economy, the patience of capital investment has often been explained with the political activity of stakeholders. Such scholarship attributes investment preferences to either set assumptions about what various actors are likely to want from their pension systems or to macro-level institutional factors. Comparing the preferences of business and labor actors in the occupational pension systems in Finland, the Netherlands, and the USA, we argue that preferences are better explained more dynamically and emerge from meso-level institutional forces. We find that financing needs and capacities, governance capacities and financial regulations explain changes in labor and business preferences with regard to fund investment. In each of the cases, a combination of these three institutional factors explains a preference shift toward more varied and more impatient investing.