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American Political Science Review Page 1 of 18 February 2010 doi:10.1017/S0003055409990384 Building Strategic Capacity: The Political Underpinnings of Coordinated Wage Bargaining JOHN S. AHLQUIST Florida State University ncompassing labor movements and coordinated wage setting are central to the social democratic economic model that has proven successful among the nations of Western Europe. The coordina- Etion of wage bargaining across many unions and employers has been used to explain everything from inequality to unemployment. Yet there has been limited theoretical and quantitative empirical work exploring the determinants of bargaining coordination. 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 evidence for this hypothesis in a panel of 15 OECD democracies, 1950–2000. I then show that the centralization of strike powers is a strong predictor of coordinated bargaining. “Peak associations frequently lack the unity needed to unemployment and inflation (Calmfors and Driffill to have any great influence on public policy, or even 1988; Alvarez, Garrett, and Lange 1991; Garrett 1998; coherent and specific policies.” Iversen 1999; Nickell and Layard 1999). Although the robustness and magnitude of these relationships as —–Olson (1982, 50) well as the directionality of causation are contested