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Mutual gains or zero sum? Labor relations and firm performance in the airline industry

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Author Info
Jody Hoffer Gittell
Andrew von Nordenflycht
Thomas A. Kochan
Abstract

The authors examine competing theoretical arguments regarding whether union representation, shared governance, wage levels, and two features of the quality of labor relations--workplace culture and conflict in negotiations--lead to better or worse outcomes for airlines, and they test these interpretations using a mix of historical and quantitative data from major U.S. airlines. Both the qualitative and quantitative results suggest that relational factors-conflict and workplace culture-are more important determinants of performance than the structural factors of unionization, shared governance, and wages. The authors conclude that efforts to recover from the current crisis in the airline industry that depend primarily on reductions in wages or union power will at best bring only short-term relief from immediate financial pressures. Sustained improvement in service quality and financial performance will require more fundamental improvements in the quality of labor relations. (Author's abstract.) (Free full-text download available at http://digitalcommons.ilr.cornell.edu/ilrreview/.)

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Article provided by ILR Review, ILR School, Cornell University in its journal ILR Review.

Volume (Year): 57 (2004)
Issue (Month): 2 (January)
Pages: 163-180
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Handle: RePEc:ilr:articl:v:57:y:2004:i:2:p:163-180

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  1. Jody Hoffer Gittell & Kim Cameron & Sandy Lim & Victor Rivas, 2005. "Relationships, Layoffs, and Organizational Resilience: Airline Industry Responses to September 11," EERI Research Paper Series EERI_RP_2005_06, Economics and Econometrics Research Institute (EERI). [Downloadable!]
  2. Eileen Appelbaum & Larry W. Hunter, 2004. "Union Participation in Strategic Decisions of Corporations," NBER Chapters, in: Emerging Labor Market Institutions for the Twenty-First Century, pages 265-292 National Bureau of Economic Research, Inc. [Downloadable!]
  3. Michael Kosfeld & Ferdinand von Siemens, 2007. "Competition, Cooperation, and Corporate Culture," IZA Discussion Papers 2927, Institute for the Study of Labor (IZA). [Downloadable!]
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