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Employee Involvment and Pay at U.S. and Canadian Auto Suppliers

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Author Info

  • Helper, S.
  • Levine, D.I.
  • Bendoly, E.

Abstract

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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Bibliographic Info

Paper provided by California Berkeley - Institute of Industrial Relations in its series Papers with number 71.

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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

Related research

Keywords: AUTOMOBILE INDUSTRY ; WORKERS ; WAGES ; WAGES;

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References

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  1. Levine, David I. & Parkin, Richard J., 1994. "Work organization, employment security, and macroeconomic stability," Journal of Economic Behavior & Organization, Elsevier, vol. 24(3), pages 251-271, August.
  2. Lisa M Lynch & Sandra E Black, 2002. "How to Compete: The Impact of Workplace Practices and Information Technology on Productivity," Working Papers 02-04, Center for Economic Studies, U.S. Census Bureau.
  3. Lindbeck, Assar & Snower, Dennis J., 1996. "Reorganization of Firms and Labour Market Inequality," CEPR Discussion Papers 1375, C.E.P.R. Discussion Papers.
  4. Akerlof, George A, 1984. "Gift Exchange and Efficiency-Wage Theory: Four Views," American Economic Review, American Economic Association, vol. 74(2), pages 79-83, May.
  5. William T. Dickens, 1986. "Wages, Employment and the Threat of Collective Action by Workers," NBER Working Papers 1856, National Bureau of Economic Research, Inc.
  6. Milgrom, Paul & Roberts, John, 1995. "Complementarities and fit strategy, structure, and organizational change in manufacturing," Journal of Accounting and Economics, Elsevier, vol. 19(2-3), pages 179-208, April.
  7. Susan Helper, 1997. "Complementarity and Cost Reduction: Evidence from the Auto Supply Industry," NBER Working Papers 6033, National Bureau of Economic Research, Inc.
  8. Lindbeck, Assar & Snower, Dennis J, 1986. "Wage Setting, Unemployment, and Insider-Outsider Relations," American Economic Review, American Economic Association, vol. 76(2), pages 235-39, May.
  9. Bearse, Peter M & Bozdogan, Hamparsum & Schlottmann, Alan M, 1997. "Empirical Econometric Modelling of Food Consumption Using a New Informational Complexity Approach," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 12(5), pages 563-86, Sept.-Oct.
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Citations

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Cited by:
  1. Petri Böckerman & Alex Bryson & Pekka Ilmakunnas, 2013. "Does high involvement management lead to higher pay?," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 176(4), pages 861-885, October.
  2. repec:iab:iabzaf:v:41:i:2/3:p:245-258 is not listed on IDEAS
  3. David I. Levine & Michael W. Toffel, 2008. "Quality Management and Job Quality: How the ISO 9001 Standard for Quality Management Systems Affects Employees and Employers," Harvard Business School Working Papers 09-018, Harvard Business School, revised Jan 2010.
  4. Stephanie Lluis, . "Human Resource Management Practices and Wage Dispersion in U.S. Establishments," Working Papers 0603, Human Resources and Labor Studies, University of Minnesota (Twin Cities Campus).
  5. Czarnitzki, Dirk & Kraft, Kornelius, 2008. "Mitarbeiteranreizsysteme und Innovationserfolg (Employee suggestion schemes and innovation success)," Zeitschrift für ArbeitsmarktForschung - Journal for Labour Market Research, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 41(2/3), pages 245-258.
  6. Ann P. Bartel, 2000. "Human Resource Management and Performance in the Service Sector: The Case of Bank Branches," NBER Working Papers 7467, National Bureau of Economic Research, Inc.
  7. Uwe Jirjahn & Kornelius Kraft, 2010. "Teamwork And Intra-Firm Wage Dispersion Among Blue-Collar Workers," Scottish Journal of Political Economy, Scottish Economic Society, vol. 57(4), pages 404-429, 09.

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