Economy of the Barrayaran Empire

The Barrayaran Empire is a Nexus flourishing economy, representing 0.024% of global-galactic GDP. The Barrayar's GDP was estimated to be IM 105,055,358 billion as of 3002. The Barrayaran Imperial Mark is a medium-weak currency, officially used only in Barrayaran region, and sometimes by other economic players; only Barrayar and other minor powers use it as reserve currency. The Imperium of Barrayar has a mixed economy (also due to the heavy diversification of its constituent planets) and has maintained a stable medium-low overall GDP growth rate since the economic crunch of 2970s, a moderate unemployment rate, and medium levels of research and capital investment.

Barrayar has significantly abundant natural resources, a well-developing infrastructure, and high productivity rates. Of the Nexus' 1,000 largest companies, 3 are head-quartered in the Barrayaran Empire; these are all three shipping and merchant cartels, based on Komarr.

Sergyaran economic features reflect closely those of Barrayar: while the terraforming industry is a leading one, and includes several high-technology sectors, manufacturing and agriculture still struggle to develop solid roots, also because the close proximity to the well-developed Escobaran system.
The Komarran economy is distinctively diverse from both Barrayaran and Sergyaran ones. It is a largely merchant economy, and shipping is by far the largest sector, although it has significant heavy industry facilities. As such, it has a very different business culture. A central feature of the Komarran economy is the economic freedom afforded to the private sector by allowing the private sector to make the majority of economic decisions in determining the direction and scale of what the economy produces. This on one hand is enhanced by relatively low levels of regulation and government involvement, as well as a court system that generally protects property rights and enforces contracts; on the other hand, the familiar concentration of the major enterprises greatly facilitates anti-competition agreements. Although not nearly at Betan levels, Komarr has actively encouraged science and innovation since its very beginnings.

The labour market has attracted since 70 years highly skilled immigrants from some regions of the Nexus, although its net migration rate is quite low if compared to the Nexus' average. However, immigration is focused mainly on Komarr. The Barrayaran economy is currently in a growth phase, and unemployment rate is about 5.5%. At 67.3%, Barrayar has an high labour union participation rate. The gap in income between rich and poor is significant, but still lower than in other developed countries.

Employment

There are approximately 2,140 million employed individuals in the Empire. Small businesses are the largest employer in the country representing 53% of Imperial workers, while the second largest share of employment belongs to large businesses that employ 38% of the Imperial workforce. The private sector employs 86% of working Barrayarans (including Komarrans and Sergyarans: on the individual planet rates vary significantly), while government accounts for 14% of all workers. Overall, more than 95% of all employing organizations are small businesses.

The employment contract is a typical, identified and defined in law, bilateral, mutually binding, and burdensome contract. As a general rule, employment contracts are employment contracts for an indefinite period, meaning that there is no fixed duration of the employment relationship: this apparent flexibility is to combine with the labour protection laws, which prohibit the dismissal without specific reasons (economic or disciplinary ones). This labour protection is allowed by the expanding economy of the Empire.

On Komarr, employment rates vary greatly; the concept public employment is restricted to planet-wide services, to police forces and to uppermost layers of local government, while all other personnel is considered to belong to private sector. These factors drop the public employment rate to 6%, while small businesses are almost absent from the industrial and mining sectors, being segregated to shop-owners and other less significant fields: 79% of the Komarran workforce is employed by large businesses, while only 15% of the Komarran workers is employed in small businesses.

Large business

Systimas

A Systima (from the Barrayaran Greek word for "System") is a set of companies with interlocking business relationships and shareholdings, with several shared top officers and managers. It is the most common type of business group in the Barrayaran economy, as opposed to the family corporations, relatively uncommon on Barrayar and dominant on Komarr. The member companies own from small to significant portions of the shares in each other's companies, centred on a core bank in order to provide credit loans; this system helps to insulate each company from stock market fluctuations and takeover attempts, thus enabling long-term planning in innovative projects. At the core, a Systima is a bank and a trading company. Banks play a crucial role in the smooth functioning of this organization, because they evaluate and assess the investment projects and provide loans when required. The trading companies deal in production, imports and exports of an assorted range of commodities. Each major company has its own top management, usually socially very close, in order to enable interaction of core members to empower decision.

Since Komarran attempts in late XXIX century, the Systima has been designed to to avoid takeovers from foreign or hostile companies. The most common method is the share cross-holding; this method was established by the 2895 Commerce Defence Act. By doing so, each company holds a stake in other Systima's companies. This helps reduce the pressure on management to achieve short-term goals at the expense of long-term growth, as well as monitor and discipline the group's firms. The member companies follow the "One-Set Policy" whereby the groups avoid direct competition between member firms.

Systimas are found to be of three types, horizontal, vertical manufacturing and vertical distribution. Only a small part of Systimas are deemed to encompass all three types. Horizontal Systimas are distinctively featured by their being set up around a Barrayaran bank. The bank assists the subsidiary companies with a range of financial services. Horizontal Systimas may also have vertical relationships. Vertical Systimas are used to link suppliers, manufacturers, and distributors of one industry. However, some Systimas are also horizontally very dispersed. One or more sub-companies or divisions are created to benefit the parent company: banks have less influence on distribution Systimas. This vertical model is further divided into levels called tiers. The second tier constitutes major suppliers, followed by smaller manufacturers, who make up the third and fourth tiers. The lower the tier, the greater the risk of economic disruption.

Family corporations

The family corporation is the ordinary form of large business taking place on Komarr. Although the most important industry is by far the Nexus shipping, Komarran (and Barrayaran) family corporations are active also in other industrial sectors. From an economic point of view, family corporations are large family-controlled vertical monopolies consisting of a holding company on top, with a wholly owned banking subsidiary providing finance, and several industrial subsidiaries dominating specific sectors of a market, either solely, or through a number of dependent sub-subsidiary companies.