The economies in the world are based on two types; the liberal market economies and the co-ordinated market economies. In liberal market economies (LME), the problem of coordination between firms and their financiers, employees, suppliers, and customers is solved through market mechanisms (Soskice, 1990). LMEs are free market economies. They are also characterized by a relatively decentralized system of industrial relations, with collective bargaining taking place at enterprise or workplace level (Soskice, 1990). Because of the dominance of the market, LMEs typically exhibit relatively short-term and adversarial relations between economic actors, i.e. the government and other international institutions. In the field of human resource management, there is a tendency for firms to have a poor record in training and development and to have limited systems of employee participation and involvement. Where trade unions are present they are kept at arm's length and the relationship is adversarial, focused mainly on distributive wage bargaining (Soskice, 1990). 'Although LMEs may be characterized by short-term and adversarial relations, they also possess a high capacity for innovation and economies of this kind secure comparative advantage by developing new products and new industries, particularly science-based industries such as biotechnology and computers' (Nissan 2003, pg 18). The prime example of a LME is the USA, but the label is also applied to the form of capitalist economies found in Australia, Britain, India, Canada, Ireland and New Zealand.This essay will bring out the comparative and contrasting features of the economies of India (the world's largest democracy), UK (one of the parent systems of the world) and the US (the world's largest economy). The employment regulations in these three countries are unique. The UK employment/labour regulations are based on 'common law' and also framed by the statute (Sargeant & Lewis, 2006). The influence of EU laws is also significant in UK in the forms of various treaties, charters and 'Framework Directives'. The US labour system is based on a heterogeneous collection of federal and state laws. Federal law not only sets the standards that govern workers' rights to organize in the private sector, but overrides most state and local laws that attempt to regulate this area. Federal law also provides more limited rights for employees of the federal government (Nissan, 2003). However, the Indian labour system is solely based on the framework set by the Constitution (Bhattacharjea, 2006). There are more than 45 national laws and several state laws which regulate the labour system in India. The Indian labour system is known to be very rigid and is generally more pro-worker.