This essay reviews recent literature on varieties of capitalism, drawing on insights from existing studies to propose a new, more differentiated way of thinking about contemporary changes in the political economies of the rich democracies. The framework offered here breaks with the “continuum models” on which much of the traditional literature has been based, in which countries are arrayed along a single dimension according to their degree of “corporatism” or, more recently, of “coordination.” In so doing, it reveals combinations—continued high levels of equality with significant liberalization, and declining solidarity in the context of continued significant coordination—that existing theories rule out by definition. I argue that these puzzling combinations cannot be understood with reference to the usual dichotomous, structural variables on which the literature has long relied, but require instead greater attention to the coalitional foundations on which political-economic institutions rest. A coalitional approach reveals that institutions that in the past supported the more egalitarian varieties of capitalism survive best not when they stably reproduce the politics and patterns of the Golden Era but rather when they are reconfigured—in both form and function—on the basis of significantly new political support coalitions.
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