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A Theory of Employment Systems: Micro-Foundations of Societal Diversity

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  • Marsden, David

    (London School of Economics)

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    Abstract

    A Theory of Employment Systems considers why there are such great international differences in the way employment relations are organized within the firm. Taking account of the growing evidence that international diversity persists despite 'globalization', it sets out from the theory of the firm first developed by Coase and Simon, and explains why firms and workers should use the employment relationship as the basis for their economic cooperation. The originality of the employment relationship lies in its flexibility. It gives managers the authority to organize work, but it also establishes limits on employees' obligations. The nature of these limits is fundamental to our understanding of the employment relationship and its international diversity. The author argues that they are provided by four basic types of employment rule. Which one predominates in a given environment is the source of international diversity in employment relations. Drawing upon evidence from the US, Japan, France, Germany, and Britain, the theory is developed to show why such diversity extends deep into key areas of human resource management, such as performance management, incentive pay, and skill development. It also explains why the open-ended employment relationship continues to dominate work despite the growth of market-mediated work relations.

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    Bibliographic Info

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    This book is provided by Oxford University Press in its series OUP Catalogue with number 9780198294221 and published in 1999.

    ISBN: 9780198294221
    Order: http://ukcatalogue.oup.com/product/9780198294221.do
    Handle: RePEc:oxp:obooks:9780198294221

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    Cited by:
    1. Jacques Bélanger, 2002. "From Human Capital to Organizational Learning," Canadian Public Policy, University of Toronto Press, vol. 28(1), pages 143-148, March.
    2. Editors : & David Marsden & Hugh Stephenson, 2001. "Labour Law and Social Insurance in the New Economy: A Debate on the Supiot Report," CEP Discussion Papers dp0500, Centre for Economic Performance, LSE.
    3. Stephan Kampelmann & François Rycx, 2011. "Does institutional diversity account for pay rules in Germany and Belgium?," Working Papers CEB 11-042, ULB -- Universite Libre de Bruxelles.
    4. Laurence Lizé & Nicolas Prokovas, 2014. "Au sortir du chômage : précaires malgré un CDI ?," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-00976252, HAL.
    5. Smirnykh, Larisa, 2005. "Labor leasing: economic theory, EU and Russia experience," MPRA Paper 21568, University Library of Munich, Germany.
    6. Powell, Justin J. W. & Solga, Heike, 2008. "Internationalization of vocational and higher education systems: A comparative-institutional approach," Discussion Papers, Research Unit: Skill Formation and Labor Markets SP I 2008-501, Social Science Research Center Berlin (WZB).
    7. Brzinsky-Fay, Christian, 2006. "Lost in transition: labour market entry sequences of school leavers in Europe," Discussion Papers, Research Unit: Labor Market Policy and Employment SP I 2006-111, Social Science Research Center Berlin (WZB).
    8. Schulze-Cleven, Tobias, 2006. "The Politics of an Experimental Society: Creating Labor Market Flexibility in Europe," Institute for Research on Labor and Employment, Working Paper Series qt92x040tt, Institute of Industrial Relations, UC Berkeley.
    9. David Marsden & Almudena Cañibano, 2009. "Participation in organisations: economic approaches," LSE Research Online Documents on Economics 25167, London School of Economics and Political Science, LSE Library.
    10. David Marsden, 2004. "The 'network economy' and models of the employment contract: psychological, economic and legal," LSE Research Online Documents on Economics 4676, London School of Economics and Political Science, LSE Library.
    11. David Marsden, 2007. "Individual employee voice: renegotiation and performance management in public services," LSE Research Online Documents on Economics 3531, London School of Economics and Political Science, LSE Library.
    12. David Marsden, 2004. "The Network Economy and Models of the Employment Contract: Psychological, Economic and Legal," CEP Discussion Papers dp0620, Centre for Economic Performance, LSE.
    13. David Marsden, 2004. "The ‘network economy’ and models of the employment contract," LSE Research Online Documents on Economics 355, London School of Economics and Political Science, LSE Library.
    14. David Marsden, 2010. "The end of national models in employment relations?," LSE Research Online Documents on Economics 48913, London School of Economics and Political Science, LSE Library.
    15. Wood, Geoffrey & Dibben, Pauline & Stride, Chris & Webster, Edward, 2011. "HRM in Mozambique: Homogenization, path dependence or segmented business system?," Journal of World Business, Elsevier, vol. 46(1), pages 31-41, January.

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