IDEAS home Printed from https://ideas.repec.org/a/sae/ecoind/v31y2010i3p307-326.html
   My bibliography  Save this article

The impact of privatization and employee share ownership on employee commitment and citizen behaviour

Author

Listed:
  • Dermot McCarthy

    (University of Limerick, Ireland, dermot.mccarthy@ul.ie)

  • Eoin Reeves

    (University of Limerick, Ireland)

  • Tom Turner

    (University of Limerick, Ireland)

Abstract

Based on a survey of employees in a large telecommunications company, this article examines the means through which privatization, accompanied by an Employee Share Ownership Plan (ESOP), impact on employee commitment and organizational citizenship behaviour. The findings show that although the ESOP has in some way moderated outcomes, privatization has had negative consequences for commitment. Despite this, 50 percent of respondents report an increased level of citizenship behaviour. In determining changes in employee commitment and behaviour, it was found that an important role is played by how employees perceive changes in conditions of employment, involvement in workplace decision-making and management—union collaboration.

Suggested Citation

  • Dermot McCarthy & Eoin Reeves & Tom Turner, 2010. "The impact of privatization and employee share ownership on employee commitment and citizen behaviour," Economic and Industrial Democracy, Department of Economic History, Uppsala University, Sweden, vol. 31(3), pages 307-326, August.
    • Handle: RePEc:sae:ecoind:v:31:y:2010:i:3:p:307-326
    DOI: 10.1177/0143831X09351213
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1177/0143831X09351213
    Download Restriction: no
    File URL: https://libkey.io/10.1177/0143831X09351213?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Andrei Shleifer, 1998. "State versus Private Ownership," Journal of Economic Perspectives, American Economic Association, vol. 12(4), pages 133-150, Fall.
    2. Haskel, Jonathan & Sanchis, Amparo, 1995. "Privatisation and X-Inefficiency: A Bargaining Approach," Journal of Industrial Economics, Wiley Blackwell, vol. 43(3), pages 301-321, September.
    3. Bos, Dieter, 1991. "Privatization: A Theoretical Treatment," OUP Catalogue, Oxford University Press, number 9780198283690.
    4. Andrew Pendleton & Nicholas Wilson & Mike Wright, 1998. "The Perception and Effects of Share Ownership: Empirical Evidence from Employee Buy-Outs," British Journal of Industrial Relations, London School of Economics, vol. 36(1), pages 99-123, March.
    5. Jeffry M. Netter & William L. Megginson, 2001. "From State to Market: A Survey of Empirical Studies on Privatization," Journal of Economic Literature, American Economic Association, vol. 39(2), pages 321-389, June.
    6. Boycko, Maxim & Shleifer, Andrei & Vishny, Robert W, 1996. "A Theory of Privatisation," Economic Journal, Royal Economic Society, vol. 106(435), pages 309-319, March.
    7. J. David Brown & John S. Earle & Almos Telegdy, 2005. "Does Privatization Hurt Workers? Lessons from Comprehensive Manufacturing Firm Panel Data in Hungary, Romania, Russia, and Ukraine," Upjohn Working Papers 05-125, W.E. Upjohn Institute for Employment Research.
    8. Joseph Blasi & Richard Freeman & Douglas Kruse, 2004. "Monitoring Colleagues at Work: Profit-Sharing, Employee Ownership, Broad-Based Stock Options and Workplace Performance in the United States," CEP Discussion Papers dp0647, Centre for Economic Performance, LSE.
    9. Rafael La Porta & Florencio López-de-Silanes, 1999. "The Benefits of Privatization: Evidence from Mexico," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 114(4), pages 1193-1242.
    10. Kay, J A & Thompson, D J, 1986. "Privatisation: A Policy in Search of a Rationale," Economic Journal, Royal Economic Society, vol. 96(381), pages 18-32, March.
    11. John Vickers & George Yarrow, 1988. "Privatization: An Economic Analysis," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262720116, December.
    12. Jackie Coyle‐Shapiro & Ian Kessler, 2000. "Consequences Of The Psychological Contract For The Employment Relationship: A Large Scale Survey," Journal of Management Studies, Wiley Blackwell, vol. 37(7), pages 903-930, November.
    13. Douglas Kruse & Richard Freeman & Joseph Blasi & Robert Buchele & Adria Scharf & Loren Rodgers & Chris Mackin, 2004. "Motivating Employee-Owners In Esop Firms: Human Resource Policies And Company Performance," Advances in the Economic Analysis of Participatory & Labor-Managed Firms, in: Employee Participation, Firm Performance and Survival, pages 101-127, Emerald Group Publishing Limited.
    14. Oliver E. Williamson & Michael L. Wachter & Jeffrey E. Harris, 1975. "Understanding the Employment Relation: The Analysis of Idiosyncratic Exchange," Bell Journal of Economics, The RAND Corporation, vol. 6(1), pages 250-278, Spring.
    15. Anthony Ferner & Trevor Colling, 1991. "Privatization, Regulation and Industrial Relations," British Journal of Industrial Relations, London School of Economics, vol. 29(3), pages 391-409, September.
    16. Andrew Pendleton, 1994. "Structural Reorganization And Labour Management In Public Enterprise: A Study Of British Rail," Journal of Management Studies, Wiley Blackwell, vol. 31(1), pages 33-53, January.
    17. Andrew Pendleton, 1997. "The Evolution of Industrial Relations in UK Nationalized Industries," British Journal of Industrial Relations, London School of Economics, vol. 35(2), pages 145-172, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Liu Ping & Hosain Md Sajjad & Li Liyan, 2019. "Does the compensation gap between executives and staffs influence future firm performance? The moderating roles of managerial power and overconfidence," International Journal of Management and Economics, Warsaw School of Economics, Collegium of World Economy, vol. 55(4), pages 287-318, December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Orietta DESSY & Massimo FLORIO, 2004. "Workers' earnings in the UK before and after privatisation: a study of five industries," Departmental Working Papers 2004-13, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
    2. Alberto Cavaliere & Simona Scabrosetti, 2008. "Privatization And Efficiency: From Principals And Agents To Political Economy," Journal of Economic Surveys, Wiley Blackwell, vol. 22(4), pages 685-710, September.
    3. Boardman, Anthony E. & Vining, Aidan R. & Weimer, David L., 2016. "The long-run effects of privatization on productivity: Evidence from Canada," Journal of Policy Modeling, Elsevier, vol. 38(6), pages 1001-1017.
    4. Willner, Johan & Parker, David, 2002. "The Relative Performance of Public and Private Enterprise Under Conditions of Active and Passive Ownership," Centre on Regulation and Competition (CRC) Working papers 30591, University of Manchester, Institute for Development Policy and Management (IDPM).
    5. Alberto Chong & Florencio de, 2003. "The Truth about Privatization in Latin America," Yale School of Management Working Papers ysm436, Yale School of Management.
    6. Paul H. Jensen & Robin E. Stonecash, 2004. "The Efficiency of Public Sector Outsourcing Contracts: A Literature Review," Melbourne Institute Working Paper Series wp2004n29, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
    7. Gong, Stephen X.H. & Cullinane, Kevin & Firth, Michael, 2012. "The impact of airport and seaport privatization on efficiency and performance: A review of the international evidence and implications for developing countries," Transport Policy, Elsevier, vol. 24(C), pages 37-47.
    8. Ádám Szentpéteri & Álmos Telegdy, 2010. "Political Selection Of Firms Into Privatization Programs. Evidence From Romanian Comprehensive Data," Economics and Politics, Wiley Blackwell, vol. 22(3), pages 298-328, November.
    9. Pan, Xia & Cheng, Wenyin & Gao, Yuning, 2022. "The impact of privatization of state-owned enterprises on innovation in China: A tale of privatization degree," Technovation, Elsevier, vol. 118(C).
    10. Bogart, Dan & Chaudhary, Latika, 2015. "Off the rails: Is state ownership bad for productivity?," Journal of Comparative Economics, Elsevier, vol. 43(4), pages 997-1013.
    11. David Parker & Colin Kirkpatrick, 2005. "Privatisation in Developing Countries: A Review of the Evidence and the Policy Lessons," Journal of Development Studies, Taylor & Francis Journals, vol. 41(4), pages 513-541.
    12. J. DavidBrown & JohnS. Earle & Álmos Telegdy, 2010. "Employment and Wage Effects of Privatisation: Evidence from Hungary, Romania, Russia and Ukraine," Economic Journal, Royal Economic Society, vol. 120(545), pages 683-708, June.
    13. Nobuaki Hamaguchi, 2002. "Will The Market Keep Brazil Lit Up? Ownership And Market Structural Changes In The Electric Power Sector," The Developing Economies, Institute of Developing Economies, vol. 40(4), pages 522-552, December.
    14. Mauricio Garrón B. & Carlos Gustavo Machicado & Katherina Capra, 2003. "Privatization in Bolivia: The Impact on Firm Performance," Research Department Publications 3154, Inter-American Development Bank, Research Department.
    15. Druk-Gal, Bat-Sheva & Yaari, Varda, 2006. "Incumbent employees' resistance to implementing privatization policy," Journal of Economic Behavior & Organization, Elsevier, vol. 59(3), pages 374-405, March.
    16. Máximo Torero, 2002. "Peruvian Privatization: Impacts On Firm Performance," Research Department Publications 3169, Inter-American Development Bank, Research Department.
    17. Alcázar, Lorena & Nakasone, Eduardo & Torero, Máximo, 2007. "Provision of Public Services and Welfare of the Poor: Learning from an Incomplete Electricity Privatization Process in Rural Peru," IDB Publications (Working Papers) 3351, Inter-American Development Bank.
    18. Morten Bennedsen & Christian Schultz, 2003. "Outsourcing, Market Structure and Elections," CIE Discussion Papers 2003-05, University of Copenhagen. Department of Economics. Centre for Industrial Economics.
    19. Michel Albouy & Hassan Obeid, 2007. "L’impact des privatisations sur la performance des entreprises françaises," Revue Finance Contrôle Stratégie, revues.org, vol. 10(1), pages 5-37, March.
    20. Arocena, Pablo & Oliveros, Diana, 2012. "The efficiency of state-owned and privatized firms: Does ownership make a difference?," International Journal of Production Economics, Elsevier, vol. 140(1), pages 457-465.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:ecoind:v:31:y:2010:i:3:p:307-326. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: http://www.ekhist.uu.se/english.htm .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.