From Sectoral Linkages to Class Conflict

Abstract

Although the sectoral framework on global commerce and coalition formation provides a better explanation of trade and political alignments in pre-1914 Britain than the Stolper-Samuelson framework, it shares the main shortcoming of the latter when applied to the interwar period. Neither approach explains the restructuring of politics along class lines after 1918. According to the sectoral framework, the continued imperfect mobility of capital and labor and deeper divisions within the business community should have led to greater, not less, cross-class cooperation over trade and trade-related issues. This article extends an earlier critique of the Stolper-Samuelson framework to address this puzzle. It argues that weak worker trade union organization modifies the incentive of business owners to align with labor on trade, even when imperfect capital mobility and divisions in the business community heighten the incentive of capitalists to form lobbying coalitions with labor. In addition to addressing the marked contrast in British politics before and after 1914, this argument has broader comparative implications. In particular, it offers a potential explanation for why pre-World War I Britain was unique, compared with other Western European countries, in being marked by strong business-labor collaboration over trade and political reform.