Labor relations under this model are confrontational as well as sectoral—a new experience for market-states such as China that have not previously permitted voluntary and competitive labor organizations. Because wages are low and because the relocation of investment is entirely unfettered, labor unions are weak. Job creation is achieved at the cost of job security. Local industries are largely unprotected from foreign competition, which tends to make the firms that survive hardy, agile, and attractive to foreign capital. Interest rates are maintained at a relatively high level in order to encourage foreign investment and to suppress inflation. Considerable income disparities are tolerated on the grounds that everyone is richer owing to the booming economy that such freewheeling competition can provide, and it is certainly true that, in terms of personal consumption and standard of living, the entrepreneurial market-states outperform all comparable states (that is, they exceed the improvement in consumer standards of living achieved by states that began with comparable levels of development).
Immigration is robust under the Entrepreneurial Model because it freely imports highly paid talent as well as low-wage workers, which tends to suppress labor costs and keep capital from going abroad. By contrast the Mercantile Model shuns immigration; indeed cultural homogeneity is almost a prerequisite for its successful operation. The Managerial Model is ambivalent: open to “guest workers” but hostile to new citizens. The Entrepreneurial Model tends to loosen the identification that citizens feel with the larger polity: autonomy and individual achievement are so prized and the consumption of particular goods so meaningful an act of self-definition that the citizens of these states “invent” their citizenships, identifying themselves with those subgroups within the state with whom they share a consumption pattern. This exacerbates the problems of social cohesion that every market-state faces. These effects are acutely felt in the entrepreneurial states that have all-volunteer military forces, federal political structures, strictly meritocratic promotion ladders, and multicultural media. Both the mercantile and managerial states, by contrast, retain conscription for military service (though with force levels vastly reduced from those of the twentieth century), affirmative action for certain social groups, and varying degrees of state control of the media.
The basic ethos of the Entrepreneurial Model is libertarian: the conviction that it is the role of society to set individuals free to make their own decisions. This ethos counsels minimal intervention in the economy as well as in the private lives of its citizens. Privatized health care, housing, pensions, and education as well as low taxes and low welfare benefits all characterize such states. Regulation on behalf of special interests is discouraged. Indeed, responsibility for regulation of any kind is largely abdicated in favor of policing by the market, which responds with extensive information to the consumer, who is expected to look out for himself. That doesn't necessarily mean that the environment is not protected or that labor is exploited: companies soon discover that they will be rewarded for “green” policies and penalized if they are discovered to have engaged in exploitative labor practices. It simply means that the role of government in protecting the public has to some extent been taken over by the media and by private groups acting on the information from, and in concert with, the media.