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Unionization and input flexibility in U.S. manufacturing, 1973-1996

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  • Elisabetta Magnani
  • David Prentice

Abstract

Input flexibility, as measured by the ability of firms to vary input demand in the face of changes in input prices, is an important dimension of labor market flexibility. Using a new dataset, the authors analyze the impact of unionization on input flexibility in U.S. manufacturing from 1973 to 1996, a period in which production was arguably becoming more flexible due to deep changes in the U.S. industrial relations system and in the broad macroeconomic environment. The authors quantify the effects of unionization on input flexibility by estimating elasticities of substitution between a broad range of labor and non-labor inputs, controlling for unionization. The pattern that emerges is more complex than that suggested by other research. In particular, low unionization apparently is associated with greater flexibility in the use of labor inputs but less flexibility in the use of non-labor inputs. (Free full-text download available at http://digitalcommons.ilr.cornell.edu/ilrreview/.)

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Bibliographic Info

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

Volume (Year): 59 (2006)
Issue (Month): 3 (April)
Pages: 386-407

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Handle: RePEc:ilr:articl:v:59:y:2006:i:3:p:386-407

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  1. John Shea, 1996. "Instrument Relevance in Multivariate Linear Models: A Simple Measure," NBER Technical Working Papers 0193, National Bureau of Economic Research, Inc.
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Cited by:
  1. Samantha Farmakis-Gamboni & David Prentice, 2007. "Does Reducing Union Bargaining Power Increase Productivity?," Working Papers 2007.04 EDIRC Provider-In, School of Economics, La Trobe University.
  2. Elisabetta Magnani & David Prentice, 2010. "Outsourcing And Unionization: A Tale Of Misallocated (Resistance) Resources," Economic Inquiry, Western Economic Association International, vol. 48(2), pages 460-482, 04.
  3. repec:taf:applec:45:y:2013:i:18:p:2547-2562 is not listed on IDEAS
  4. Jack Kleinhenz & Russ Smith, 2011. "Regional Competitiveness: Labor-Management Relations, Workplace Practices, and Workforce Quality," Business Economics, Palgrave Macmillan, vol. 46(2), pages 111-124, April.

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