The authors present an alternative to power resource theory as an approach to the study of distribution and redistribution. While they agree that partisanship and union power are important, they argue that both are endogenous to more fundamental differences in the organization of capitalist democracies. Specifically, center-left governments result from PR consensus political systems (as opposed to majoritarian systems), while strong unions have their origins in coordinated (as opposed to liberal) capitalism. These differences in political representation and in the organization of production developed jointly in the early twentieth century and explain the cross-national pattern of distribution and redistribution. The clusters have their origins in two distinct political economic conditions in the second half of the nineteenth century: one in which locally coordinated economies were coupled with strong guild traditions and heavy investment in cospecific assets and one in which market-based economies were coupled with liberal states and more mobile assets.