Why Do Voice Regimes Differ?
AbstractIn this paper we seek to explain the emergence of different voice regimes, and to do so by using approaches from institutional economics. In particular we analyse the emergence of different voice regimes as a contracting problem; a ¿make¿ or ¿buy¿ decision on the part of the employer. A unique feature of the model is that the firm, having chosen its particular employee management regime, faces switching costs if it attempts to alter its original make or buy decision. A particular dimension of the employee management regime decision is the use of the union as agent or supplier of voice, or elements thereof. We argue that there are circumstances in which the employer may, on grounds of cost or risk, seek to subcontract aspects of the management of labour to a union and, further, that this (along with the presence of switching costs) helps explain the continued recognition of trade unions in many firms. In other circumstances, however, the employer may seek to construct voice mechanisms without union involvement. Workplace data from Britain are used to test these and other implications of the model.
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Bibliographic InfoPaper provided by Centre for Economic Performance, LSE in its series CEP Discussion Papers with number dp0591.
Date of creation: Nov 2003
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Web page: http://cep.lse.ac.uk/_new/publications/series.asp?prog=CEP
trade unions; voice; transaction cost economics; switching costs;
Find related papers by JEL classification:
- J5 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining
- J50 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - General
- J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
- L5 - Industrial Organization - - Regulation and Industrial Policy
This paper has been announced in the following NEP Reports:
- NEP-ALL-2003-12-07 (All new papers)
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CEP Discussion Papers
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