Using both survey data and field research, we investigate the effects of employee involvement practices on outcomes for blue-collar workers in the auto supply industry. Using a variety of measures, we find consistent evidence that these practices raise wages by 3-5%. The causal mechanism linking involvement and wages appears most consistent with efficiency wage theories, and least consistent with compensating differences. With respect to employment stability, we find that employee involvement has a knife-edge character. Plants with intensive programs have larger employment gains, but are also slightly more likely to go out of business. These results are consistent with employee involvement raising quality and productivity, but also increasing fixed costs for liquidity-constrained firms.
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Paper provided by California Berkeley - Institute of Industrial Relations in its series Papers with number
71.
Length: 49 pages Date of creation: 1999 Date of revision: Handle: RePEc:fth:calbir:71
Contact details of provider: Postal: U.S.A.; University of california Berkeley, The Institute of Industrial Relations. 2521 Channing Way. Berkeley California 94520-5555
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Find related papers by JEL classification: L62 - Industrial Organization - - Industry Studies: Manufacturing - - - Automobiles; Other Transportation Equipment J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
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