ABSTRACT
Since the late 1950s the premier institution of Austrian neocorporatism has been the Parity Commission. It has antecedents in a series of less successful attempts dating from the interwar and early postwar years. The earliest postwar labor-business relationship was characterized by nominal state authority over a disjoint wage and price determination process. The economic cycle argument, that during an upswing labor’s bargaining position is better and hence capital is more willing to establish concertative institutions, helps but does not fully account for the emergence of a lasting regime. The export promotion path on which Austria was forced in the postwar period made the low factor cost economy unavoidable and put labor, if well enough organized, in the driver’s seat in the flow of factor costs across the economy. The Scandinavian experiences in the 1970s, and Austria’s pre-1950s experiments, suggest that tripartism was only a “second-best” alternative.
