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Building Strategic Capacity: the political underpinnings of coordinated wage bargaining


The coordination of wage bargaining has been used to explain everything from inequality to unemployment in rich democracies. Yet there has been little theoretical work and almost no quantitative empirical work exploring the determinants of bargaining coordination. Others hypothesize that centralized bargaining depends on the ability of peak associations to control the strike activities of their aliates. I argue formally that more unequally distributed resources across unions should inhibit the centralization of strike powers in union federations. Using membership as a proxy for union resources, I find empirical support for this hypothesis in a panel of 15 OECD democracies, 1955-92. I then show that the centralization of strike powers is a strong predictor of coordinated bargaining. I also �nd that the in uence of other variables purported to explain bargaining coordination (trade, country size, party systems fragmentation, government partisanship, and federalism) ow only through their relationships with centralized strike powers.

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