Why do almost all internet start-ups come from the USA, while the most sought-after cars in the world come from Germany? Such differences can be explained by the theory of Varieties of Capitalism, which classifies countries into liberal and coordinated market economies. While liberal market economies excel at inventing new products, coordinated market economies focus on improving existing products. This book explains why almost all English-speaking countries utilize the market and have very high income disparities; conversely, it also explains why Germany and other European countries with strong welfare states and labor unions are successful.