A good deal more than the English Channel separates the coordinated market economies of continental Europe from their liberal cousins to the west; yet, scholars remain puzzled about the origins of these divergent economic models. How, for example, do the “virtuous circles” of coordination manage to take hold in many European nation states, whereas the Tocquevillian patterns of cooperation fail to thrive beyond American communities? At the dawn of the 20th century, employers and their government supporters across the Western world sought to develop peak business associations to nurture developmental capitalism; yet, these experiments in nonmarket coordination ultimately resulted in quite different organizational forms. Some countries produced fragmented or “pluralist” associations, whereas others developed highly organized, centralized, and hierarchical “social corporatist” groups. With the great political transformation in the 19th century—when capitalist development and the globalization of trade created pressures for the nationalization of industrial public policies—how did these national patterns of either cooperation or free market liberalism become institutionalized?

We seek to discover the determinants of corporatist and pluralist associations; in particular, we reflect on the political factors—the structures of party representation and the state—that shape the formation and subsequent trajectories of employers' peak organizations. If employers require an executive manager to help them organize their interests and shape their collective political identities, then the terms of political engagement—set by party systems and electoral rules—should influence the evolution of their organizational capacities. We hypothesize that proportional, multiparty systems are more likely to foster the development of corporatist associations, whereas non-proportional, two-party systems are conducive to the formation of pluralist associations. Countries with multiparty systems have dedicated business parties with political incentives to cooperate with other parties and social actors to form governing coalitions; consequently, these parties help to develop the collective voice of business. In addition, employers in multiparty coalitions might surmise that they have a smaller chance of capturing a party likely to win an electoral majority than their counterparts in two-party systems; therefore, they may be more interested in the creation of non-state policymaking channels that delegate considerable power to social actors. In contrast, the large umbrella parties found in two-party systems cut across class lines: employers are dispersed across parties, have difficulty finding common ground, have fewer political reasons to negotiate with labor, and, thus, form fragmented “pluralist” groups. When these employers do capture one party, they have no political reason to compromise with the other party to achieve an electoral majority and have fewer motivations to push the development of nonpolitical channels. Moreover, we suggest that federal systems engender pluralist associations, because decentralized political authority makes for greater levels of regional diversity in policy decisions and outcomes. Employers' organization will tend to be likewise fragmented in federal systems.

Our insights into the origins of organized employers are important for several reasons. Initially, our research has bearing on the genesis of managed capitalism versus liberal market capitalism. Although others have fruitfully investigated the impact of preindustrial traditions of cooperation and skills development on the emergence of industrial coordinated economies, the influence of electoral and party systems on coordination has been largely neglected (Thelen Reference Thelen2004; Hall and Soskice Reference Hall and Soskice2001; but see Cusack, Iversen, and Soskice Reference Cusack, Iversen and Soskice2007). Additionally, only limited empirical research has been done on the specific origins and early development of employers' associations (but see Crouch Reference Crouch1993). We agree that industrial relation traditions are important legacies for employer organization, but would direct scholarly attention to the political structures that are also salient in determining early patterns of coordination. In short, the relationship between electoral and industrial relation systems is dynamic and we stress the co-evolution of political representation and economic organization. An encompassing business organization (and coordinated capitalism) have difficulty surviving without a consensual PR party system; thus, business representation varies systematically with the party system.

Moreover, our paper contributes theoretically to the scarce literature on the links between party systems and interest organization (but see Cusack, Iversen, and Soskice Reference Cusack, Iversen and Soskice2007). Students of comparative politics generally root political party development in the structure of societal cleavages (Lipset and Rokkan Reference Lipset and Rokkan1967; Bartolini Reference Bartolini2000), yet we highlight the reciprocal influence of parties and electoral systems on the historical evolution of business organization and social class. Scholars of contemporary parties recognize the overlapping functions and interconnections between interest organizations and political parties: alternative forms of interest intermediation may develop in response to representational gaps in party politics (e.g., Lawson and Merkl Reference Lawson and Merkl1988). It arguably follows that the initial development of employers' associations was also molded by party competition.

Finally, our analysis has important implications for understanding the sources of social solidarity and equality. We have shown elsewhere that corporatist forms of employer organization have a significant impact on social protection programs (Martin and Swank Reference Martin and Swank2004). Thus, from the perspective of welfare state theory, it is vital to understand the initial development and evolution of these organizational forms.

THEORIES OF BUSINESS ORGANIZATION

National umbrella business associations developed across the Western world in the latter part of the 19th century in response to the growing consensus that industrialization required national rather than regional policy solutions (e.g., see Bensel, Reference Bensel2000). Regionally dominated and diverse economies were consolidating into national economies, markets were increasingly global, and remarkable technological advances were demanding more evolved workforce skills. Consequently, national business groups developed to promote industrial interests in policy debates and to help companies work collectively on tasks that could not be done individually. Yet these early experiments in national business organization rather rapidly produced quite different types of peak associations. Although some advanced industrialized nations ultimately saw the emergence of a single peak employers' association to represent collective business interests, other countries witnessed multiple umbrella groups and a system of representation marked by fragmentation and redundancy. Table 1 offers systematic evidence on the degree of employers' organization from the beginning of the 20th century to the 1930s. Our core measure of organization indexes, on a 3-to-9 scale, the scope, centralization, and policymaking integration of peak associations in 4 decades (see table notes and the discussion of measurement of employer organization below). By the 1910s, nations had begun to bifurcate between those that had more social corporatist associations and those that were clearly more pluralist. Thus, employers in the Nordic and Germanic nations had, by the onset of World War I, begun to establish relatively broadly organized and centralized associations. Employers associations in the Anglo nations, most notably, remained more fragmented and decentralized. These patterns of differentiation accelerated in the 1920s and 1930s.

TABLE 1.

Patterns of Employers' Organization in Developing and Democratizing Nations, 1900–1938

Note: The table displays our additive index of (1) scope of employers organization (i.e., the share of employers organized in peak national associations); (2) the centralization of power (e.g., control over strike/lockout funds, bargaining strategies) in peak national associations; and (3) integration of national peak associations into national policymaking forums. (See text in measurement section for more detail.

^a Employers organization measured circa 1921–22.

How do we account for the degree to which national business communities developed highly organized and centralized collective associations? We suggest three broad causes of employers' organization. First, differences in the stage and type of capitalist development might differentially affect employers' needs for collective organization and action. The development of a national peak employers' association may be influenced by the level of industrialization, as indexed by per-capita income or wealth generated by economic production and the manufacturing share of total economic output. Historical analysis suggests that sector trade associations, and subsequently, multisector umbrella organizations developed to manage competition associated with unregulated capitalism (by controlling prices, output, and the entry of new firms) and to assist in rapid industrial growth (by facilitating standardization, innovation, research and development, insurance benefits, and consensual labor relations; Tedlow Reference Tedlow, Yamazuki and Miyamoto1988; Lynn and McKeown Reference Lynn and McKeown1988, 2–3). (We delineate hypotheses in Table 2. See hypotheses 1 and 2.)

TABLE 2.

Hypotheses on the Origins and Development of Employers' Organization

In addition, industrial sectors producing for export markets may be more likely to form trade associations than those producing for domestic consumption, and national economies with a larger share of exports may be more likely to develop highly centralized business groups. Business associations provide firms with a forum to unify against the common enemy of foreign firms, by nurturing collective action (Katzenstein Reference Katzenstein1985; Gourevitch Reference Gourevitch1986; Davenport-Hines Reference Davenport-Hines, Yamazuki and Miyamoto1988). Alternatively, employers in countries with few exports might experience less pressure to organize for these purposes or to constrain wages; in the absence of international openness, they might be more willing to satisfy labor demands for higher wages in order to secure labor peace (Galenson Reference Galenson1952; see Table 2, hypothesis 3).

The degree of regional diversity in national economies might also influence how employers organize their peak associations. High levels of economic regional diversity should complicate organization, because pronounced regional diversity makes it more difficult for employers to identify common ground; therefore countries with more diverse, regionally specific economies might be expected to develop less-centralized employers' associations (Tolliday and Zeitlin Reference Tolliday and Zeitlin1991; see Table 2, hypothesis 4).

A second broad set of explanations posits employer organization as a reaction to labor activism or to other features of the labor and industrial relations system. One argument is simply that business organizes to fight unions; consequently, employers should produce higher levels of cooperation and organization when faced with threats from more highly organized labor movements (e.g., Stephens Reference Stephens1979; Crouch Reference Crouch1993; see Table 2, hypothesis 5). Ethnic and religious divisions in the broader society hinder labor's ability to organize and, relatedly, business organization as well (Stephens Reference Stephens1979; King, Reference King2005; Manow and Van Kersbergen 2007). American “exceptionalism” has been linked to the immigrant communities that dominated 19th-century America, making ethnicity trump class (Hartz Reference Hartz1955). In Europe, religious or ethnolinguistic cleavages created a pillorization of society; for instance, in the Netherlands, Protestant and Catholic employers' associations were integrated with Protestant and Catholic unions and other civic associations in religiously distinct networks. Thus, we assess the hypothesis that the degree of religious and ethnolinguistic cleavages tends to depress employers' organization (see Table 2, hypothesis 6).

Worker skills and other features of industrial relations also matter; thus, coordination among employers is heavily influenced by 19th-century traditions of economic cooperation and coordination (Thelen Reference Thelen2004; and Swenson, Reference Swenson2002; Cusack, Iversen, and Soskice Reference Cusack, Iversen and Soskice2007). Four dimensions are important. First, strong preindustrial guilds result in better organized industrial employers' organizations, because guilds facilitated vocational training systems that allowed firms to develop specific assets and that, in turn, created an ongoing need for high levels of skills and industrial coordination. Second, employer organization may be influenced by the presence of rural cooperatives that foster the integration of agricultural, industry and financial interests. Third, employer organization may be facilitated by the predominance of industrial versus craft unions; industrial unions create the capacity and interests in unions to engage in cooperation with employers over training and wages. Fourth, employer organization may be linked directly to the degree to which the economy is dominated by a skills-based export sector; these firms use highly skilled labor and have a greater need for collective training and bargaining arrangements to secure workforce stability and wage concessions. Thus, we would hypothesize that these 19th-century “traditions of coordination” should be associated with employers' organization in the early decades of the 20th century (Table 2, hypothesis 7).

Overall, these legacies of cooperation are important for our argument. This is so not only because these factors in all likelihood play an important role in fostering employers' organization, but because they are also related to the emergence of proportional, multiparty systems. That is, recent work by Cusack, Iversen, and Soskice (Reference Cusack, Iversen and Soskice2007) has linked these traditions of coordination, or the co-specific assets of labor and business that develop under these forms of coordination, to the choice of proportional representation by business. Thus, the absence of a general theoretical accounting of these forces as well as a statistical control for coordination may well lead us to accept a spurious relationship between proportionality/multipartism and employers' organization. At the same time, although legacies of coordination are important, we would stress that cross-national varieties of capitalism may have been less starkly different in the 19th than in the 20th century. Coordinated market economies could be found at the regional level throughout Europe and North America before the first “industrial divide”; however, only some countries adopted coordinated national production regimes. For instance, American manufacturing processes in many sectors resembled those in continental Europe and a diversity of models or economic dualism may best characterize American manufacturing during this period (Piore and Sabel Reference Piore and Sabel1984; Berk Reference Berk1994). Many American communities also had extensive apprenticeship and training systems during the 19th century (Piore and Sabel; Hansen Reference Hansen1997; Martin Reference Martin2006). Moreover, we believe that politics, to which we now turn, also shape the emergence and maturation of organized employers in the early decades of the 20th Century.

A third set of explanations explores the direct influence of electoral and party systems and state structures on variation in national patterns of business association. Although scholars have explored the impact of aspects of state agency and structure on employer organization (Garon Reference Garon1987; Martin Reference Martin1991, Reference Martin1994; Schneider Reference Schneider2004) and on public policy making more generally (Huber, Ragin, and Stephens Reference Huber, Ragin and Stephens1993; Steinmo Reference Steinmo1993), the structure of electoral-party systems is a relatively neglected influence in the study of business organization. Yet because parties and interest organizations are both institutions for intermediating societal interests, we might reasonably expect dynamics in one sphere to affect dynamics in the other. Past analytic work on linkages between societal organizations and party systems has assumed a causal chain from groups to parties: parties emerge from societal cleavages and organizations (Daadler Reference Daadler, LaPalombara and Weiner1966; Lipset and Rokkan Reference Lipset and Rokkan1967). But party systems might also shape the development of societal cleavages, inspiring the development of employers' association from the top down or from the bottom up. When existing parties inadequately represent a societal group's interests, a dedicated interest organization might form from the bottom up in order to address this gap in representation (Torcal and Mainwaring Reference Torcal and Mainwaring2003). Alternatively, party strategists might create a business group from the top down to serve their political needs of rallying societal support for the party's agenda or to develop corporate capacity to implement the policies of the business party (Martin Reference Martin1991, Reference Martin1994).

Several features of party systems and state structures may shape the attributes of business associations. First, our core hypothesis is that features of business organization are deeply influenced by the degree of proportionality and multiparty representation: these electoral arrangements influence the incentives of both employers and party activists in the organization of business coordination. Specifically, we postulate that proportional, multiparty systems are more likely to guide employers' associations into social corporatist forms, whereas nonproportional two-party systems are more likely to give rise to pluralist associations.

Actors in nonproportional, two-party and proportional, multiparty systems face different strategic games, because nonproportional, two-party systems offer a more incomplete electoral coverage of social groups than do proportional, multiparty systems. Multiparty systems often include dedicated business parties; in the context of proportional electoral rules, these partisan organizations can make credible commitments to their members on future benefits and coverage of interests is fairly high (Iversen Reference Iversen2005; Cusack, Iversen, and Soskice Reference Cusack, Iversen and Soskice2007). These dedicated business parties help to aggregate and to unify broad corporate interests; therefore, they may assist in developing the collective voice of business. Dedicated business parties have incentives to form alliances with parties representing workers, farmers, and other interests in order to join ruling coalitions, and one might expect these parties to transfer this spirit of cooperation to employers' associations. In countries with multiple parties, managers calculate that their chances of capturing a party likely to win an electoral majority are minimal; therefore, they have an interest in the creation of policymaking channels that work outside of government by delegating considerable power to social actors. Highly organized employers associations may emerge to coordinate labor and industrial relations systems and to help with state development strategies; yet, these groups should be less involved in electoral politics (the party's prerogative).

In two-party systems, the large umbrella parties tend to cut across class lines and employers (and other groups) are often dispersed across parties. Systems of two-party competition generally create a “representation gap” in electoral politics, because parties compete for and formulate positions to appeal to the median voter and, therefore, cannot make credible commitments to specific social groups (Downs Reference Downs1957). Interest groups such as business associations may develop to fill voids created by representation gaps, but this path to interest group development may produce more fragmented, less unified, less cooperative and more politicized groups. When employers are dispersed across parties, a common corporate voice may be more difficult to establish. No business party exists to urge the associations to develop accommodating positions with labor. When employers in two-party systems do capture one of the parties (as was the case of the US Republican party in 1896), they still have no reasons to compromise with the other party. They may seek to attract workers to their constituency base, but they have no political reason to encourage the development of an organized working class. When business organizations develop to substitute for real business parties, employers' associations should be expected to play a bigger role in electoral politics. The excessively politicized nature of business organizations in two-party systems might give rise to greater questions about the employers' associations legitimacy and, in turn, undermine employers' roles in labor and industrial relations and economic development.

These fundamental differences in the consequences of electoral systems for employers mean that associations often have quite different functions in the two types of party systems. Because the coverage of employers' interests is likely to be more complete in proportional systems, the associations are less likely to be electoral in function; and because the business party needs to cooperate with labor, the associations are likely to be encouraged by the party to develop processes of negotiation that minimize class conflict. Thus, we expect proportional multiparty systems to be associated with social corporatist business organization (Table 2, hypothesis 8).

Second, the structure of the state, especially the degree of federalism, should matter.Footnote ¹ Generally, the dominant view in democratic theory has been that organization articulation of interests follows constitutional structure (e.g., Coleman Reference Colman, Bakvis and Chandler1987). In our view, the degree of power sharing between levels of government matters in that it shapes the goals of both bureaucrats and interest groups; thus, political authority dispersed to the local level makes it less likely that national employers' organizations will achieve high levels of centralization and coordination. The degree of governmental centralization matters in that national-level bureaucrats in federal systems of shared power have more modest goals than their counterparts in centralized systems with concentrated power. Thus, although in some countries the formation of national-level business associations might coincide with the development of national regulations (and employer associations might provide input into the design of these regulations), the limited national goals of federal countries might delimit the goals of the newly emerging business associations (Hawley Reference Hawley1966). Federal systems have greater levels of regional diversity in policy outcomes and employers' associations will have similarly diverse concerns across these regions. Thus, when power is dispersed to the regional levels, business associations are more likely to develop at the regional levels. Admittedly, coordinated capitalism has developed in federal systems. This is especially the case in sector coordinated systems such as Germany. Yet, Denmark and other more centralized Scandinavian polities have developed stronger macro-corporatist institutions at the national level.

In addition, federal systems also have less centralized political parties, and parties dominated by local elites have less need for centralized business organizations than parties with strong, national leadership. A party dominated by local organizations will be ill-equipped to address national issues; a national party should have a greater need for centralized business support for its political agenda. The goals of government, of course, influence the level at which parties organize (Amorin and Cox Reference Amorin and Coz1997). Yet once created, the level of party institutionalization (national versus local) should have independent effects on social structures (Chhibber and Kollman Reference Chhibber and Kollman2004). The problem of incomplete coverage is also exacerbated when two-party systems also have high levels of geographical diversity: when sectional or regional diversity constitutes the primary cleavage dividing the electorate into two parties, class determinants of party identification lose salience. Industrialists are likely to be underrepresented in the national political arena and this complicates the political expression of the collective interests of employers. In sum, we hypothesize that the degree of federalism should be negatively associated with employers' organization (Table 2, hypothesis 9).

FINDINGS FROM THE HISTORICAL QUANTITATIVE ANALYSES

We report the findings from estimation of our basic model of employers' organization and from additional models that test supplementary political institutional, economic needs/structures, and labor and industrial relations systems hypotheses in Table 3. The results displayed under column I do indeed suggest that several focal factors are statistically associated with the degree of organizational articulation of employers in the 1900 to 1930's period. The proportionality of the electoral system (ordinal measure) is significantly related (p < .01) to the degree of employer organization. The substantive magnitude of this effect (β = 1.9) is also large: an increase from minimal to moderate, or moderate to high proportionality is associated with an increase of roughly 2.0 on our scale of employer organization (recall the range of this variable is 3.0 to 9.0). Shifting to column II, one can also see that our column I finding on the large role of proportionality is bolstered by the comparably large and significant effect of the index of disproportionality. In the third column equation, we use our simple measure of multipartism. Although this factor is influenced by the complexity of cleavage structures, we do find, as in the case of the previous two indicators of the nature electoral-party systems, that simple multipartism is positively associated with the degree of employer organization. Ultimately, we select the ordinal measure of proportionality as our preferred specification for the electoral-party system factor: the overall fit of the model with this specification is much better; the simpler scale is more readily interpreted, and the measure is more robust to additional controls and estimators. (Also see the measurement section on choice of this variable.)

TABLE 3.

The Underpinnings of Employers' Organization, 1900s–1930s in 16 Nations

Note: All models are estimated with OLS with panel correct standard errors. Cases are 36 country decades for the 16 nations defined in the text. Each model includes time period dummies for 1900s, 1910s, and the 1920s.

*p < .10.

**p < .05.

***p < .01.

With respect to the other core factors, federalism is negatively associated with employers' organization. Although the substantive magnitude of this effect is nontrivial—the difference in employer organization between federal and unitary polities is close to 1.0 (β = .76), and although it is highly significant in some estimations and robust in the jackknife results (see below), federalism is statistically significant at only the .10 level (or falls just short of significance) in column I and in some additional variations of the model. Interestingly, in models where federalism is not significant, alternative measures of fragmentation and diversity such as (log) area, are significant. In addition, the relationship between employer organization and our central measure of past union mobilization is highly significant in column I and in virtually all specifications of our models. In terms of substantive magnitude, a past increase in unionization rates of 10% of the work force would, all else being equal, result in a .5 increase on our (3-to-9) scale of employer organization. Finally, column I results for our economic forces are generally not strongly supportive of hypotheses that stress economic structural conditions, needs, and related dynamics in shaping the development of employers' associations. Geographic size and international (trade) openness are not significantly related to employer organization in most models; (log) per capita GDP is, however, modestly associated with the employers measure in column I and in the majority of other model specifications.

We display the tests for the hypothesized effects of an additional measure of economic structure, namely, economic concentration in industry (manufacturing share of GDP) in the fourth column of Table 3. Economic concentration in manufacturing; although correctly signed, is only marginally significant. In additional specifications of the model, manufacturing concentration as well as the set of complementary measures of the dispersion of economic activity proved to be generally insignificant, trivial in the magnitude, or incorrectly signed with regard to impacts on employer organization.

We display tests for additional hypotheses on the impacts of labor and industrial relations factors in the fifth and sixth columns of Table 3. We might first note that union mobilization retains its substantively strong and statistically clear association with employer organization in these models. We also test for the effects of potentially fragmenting nonclass cleavages as well as the potentially positive impacts of traditions of coordination. As the column results indicate, we find no support for the argument that net of other forces, religious and ethnolinguistic fragmentation has significant independent impacts on the organization of employers. On the other hand, the coordination variable is correctly signed and highly significant. This finding adds support to the argument developed by Cusack, Iversen, and Soskice (Reference Cusack, Iversen and Soskice2007) and Iversen and Soskice (no date) that guild traditions, cooperative legacies, industrial unions, and a large skills-based export sector are associated with employers' organization and promote the further development of coordination. It is also important to note that in the presence of this control, our central measure of proportionality remains significant. As discussed earlier, the presence of this variable, itself an important correlate of corporatist organization of employers, should minimize concerns that the significant relationship between proportionality and employer's organization is spurious.

We now move to the last stage of our quantitative analysis. This consists of a test of our arguments as explanations of pre-World War II national economic coordination as well as a set of tests of the robustness of our final model; that model is displayed in column I of Table 4. (Also note that the final model and disaggregated models of sets of factors along with a variety of model statistics are reported in the Appendix.) Column II of Table 4 displays the results of our estimation of the basic model for pre-World War II social corporatism. As the table indicates, the overall model explains 1900–1930's variations in the degree of development of social corporatism fairly well (R² = .71). Moreover, political forces—electoral proportionality and federalism—exert substantial and significant influence on the development of social corporatism. So too does the strength of traditions of coordination and the level of economic development. Geographic size and economic openness, however, are not significantly related to national coordination in the pre-World War II era. Overall, political economies with relatively high levels of industrialization, strong legacies of coordination, centralized state structures, and proportional electoral systems were much more likely to develop corporatism in the 1900–1930's period than other systems.

TABLE 4.

Final Models of Pre-WW II Employers Organization and Social Corporatism

Note: Models of columns I to III are estimated with OLS with panel correct standard errors. Cases are country decades as defined in the text. The model includes time period dummies for 1900s, 1910s, and the 1920s. The models of columns IV and V report jackknifed coefficients as defined in the text.

*p < .10.

**p < .05.

***p < .01.

Finally, Table 4 reports the results of our estimation of a lagged endogenous variable model and of jackknife tests of robustness of our basic model of 1900–1930's employers organization to exclusions of individual countries and decades from the analysis. These tests indicate that the core factors for which we have received consistent support—proportionality of the electoral system, federalism, union mobilization, traditions of coordination, and the level of development—proved generally robust to these alternative specifications and tests. For the dynamic specification entailed by the lagged endogenous variable model, greater proportionality, unionization, and traditions of coordination are associated with higher employers' organization. As noted earlier, the control for past levels of employer association also assuages fears about a spurious correlation between proportionality and current employers' organization. Finally, all these consistently important factors—proportionality, federalism, unionization, traditions of coordination, and economic development—are highly robust to deletions of nations and decades.Footnote ⁵

In sum, historical quantitative data analysis of pre-World War II variations in employer associations suggests that electoral and party systems, federalism, features of labor and industrial relations systems, most notably, unionization and traditions of coordination, and economic development largely explain why some nations experienced corporatist organization of employers. We now turn to our historical analysis of the paradigmatic cases of Denmark and the United States to further assess and articulate these arguments and findings.

FINDINGS FROM THE COMPARATIVE CASE ANALYSES

The following section on the origins and evolution of peak employers' associations in Denmark and the United States offer case study findings about our three broad hypotheses that augment the results of our historical quantitative analysis. This case selection is appropriate because both countries developed associations in the mid 1890s and each represents a quintessential example of a model country: the Danish employers' association was the frontrunner among European organizations in attaining high levels of corporatist coordination, and the United States is often evoked as an exemplar of the liberal-market economy with pluralist labor and business organizations.

First, as is detailed later, the case studies support our core hypothesis that the structure of party competition was important to the development and subsequent trajectories of employers' associations in Denmark and the United States. In both, business organization was partially a top-down process, in that party leaders encouraged employers to form associations; in addition, the dynamics of multiparty competition (later associated with proportional representation) reinforced employer coordination in Denmark, whereas two-party competition hindered business cooperation in the United States. Thus associations in both countries were, in part, initiated by political leaders to aid party ambitions such as expanding constituent bases and supporting policy agendas, yet major differences in partisan competition sent the Danish Employers' Federation and the National Association of Manufacturers down radically divergent tracks.

Second, the legacies of 19th-century traditions for economic cooperation and coordination (or the lack thereof) also played a role in the evolution of employers' associations in the two countries. Party politics in Denmark supplemented the legacies of the guild tradition and high-skills production in steering Danish employers toward a cooperative stance with a more highly organized workforce. In contrast, although many American employers sought to develop institutions to foster skills development and cooperation with labor, others (especially in the south) pursued a low-wage strategy. These sectional differences in the diverse parts of the American economy were augmented by the dynamics of the two-party system in hindering the emergence of a corporatist employers' association.

Third, although employer organization in both countries was clearly motivated by the emergence of industrial capitalism, the cases give less support to cross-national differences in levels of industrial development. In both countries, employers organized, in part, to seek public policies favorable to manufacturing, to nurture industrial capitalism and to transfer regulatory privilege from agriculture to manufacturing (NAM, Edgerton 1926). For example, NAM formulated goals to build infrastructure for manufacturing and foreign trade: its Committee on Resolutions proposed as a basis for organization the ambition that, “our home market should be retained and supplied by our own producers and our foreign trade relations should be extended in every direction” (“Delegates Got Down to Business” 1895, 8). Yet this hypothesis might lead us to expect a greater level of organization in the United States than in Denmark, as the latter remained more solidly dominated by agricultural interests and manufacturers (as opposed to farmers) produced little for foreign markets. Yet, according to Galenson (Reference Galenson1952, 71–72; Hyldtoft Reference Hyldtoft1999), Denmark's domestic focus made employers more—rather than less—motivated to join associations.