Advanced Search
MyIDEAS: Login

Sluggish Institutions in a Dynamic World: Can Unions and Industrial Competition Coexist?

Contents:

Author Info

  • Hirsch, Barry

    ()
    (Georgia State University)

Abstract

During the 1930s and 1940s, collective bargaining emerged as the workplace governance norm in much of the U.S. industrial sector. Following its peak in the 1950s, union density in the U.S. private sector fell steadily, to only 7.4 percent in 2006. Governance shifted from a formalized union norm to one of constrained managerial discretion. In competitive and dynamic economic environments, a union tax on company earnings and slow response to economic shocks combine to produce poor performance by union companies. Two industries – automotives and airlines – are used to illustrate these points. If worker-based institutions are to flourish, they must add value and permit companies to perform at levels similar to those obtained under evolving nonunion governance norms.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://ftp.iza.org/dp2930.pdf
Download Restriction: no

Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 2930.

as in new window
Length: 30 pages
Date of creation: Jul 2007
Date of revision:
Publication status: published in: Journal of Economic Perspectives, 2008, 22 (1), 153-176
Handle: RePEc:iza:izadps:dp2930

Contact details of provider:
Postal: IZA, P.O. Box 7240, D-53072 Bonn, Germany
Phone: +49 228 3894 223
Fax: +49 228 3894 180
Web page: http://www.iza.org

Order Information:
Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany
Email:

Related research

Keywords: motor vehicles; airlines; density; membership; wage premium; economic performance; wages; workplace governance; labor unions;

Other versions of this item:

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Christopher R. Bollinger & Barry T. Hirsch, 2006. "Match Bias from Earnings Imputation in the Current Population Survey: The Case of Imperfect Matching," Journal of Labor Economics, University of Chicago Press, vol. 24(3), pages 483-520, July.
  2. Morris M. Kleiner & Jonathan S. Leonard & Adam M. Pilarski, 2002. "How industrial relations affects plant performance: The case of commercial aircraft manufacturing," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 55(2), pages 195-218, January.
  3. Alan B. Krueger & Alexandre Mas, 2002. "Strikes, Scabs and Tread Separations: Labor Strife and the Production of Defective Bridgestone/Firestone Tires," Working Papers 125, Princeton University, Department of Economics, Center for Economic Policy Studies..
  4. Clark, Kim B, 1984. "Unionization and Firm Performance: The Impact on Profits, Growth, and Productivity," American Economic Review, American Economic Association, vol. 74(5), pages 893-919, December.
  5. Cramton, Peter & Tracy, Joseph, 1998. "The Use of Replacement Workers in Union Contract Negotiations: The U.S. Experience, 1980-1989," Journal of Labor Economics, University of Chicago Press, vol. 16(4), pages 667-701, October.
  6. Richard B. Freeman, 1997. "Spurts in Union Growth: Defining Moments and Social Processes," NBER Working Papers 6012, National Bureau of Economic Research, Inc.
  7. Barry T. Hirsch & Edward J. Schumacher, 2004. "Match Bias in Wage Gap Estimates Due to Earnings Imputation," Journal of Labor Economics, University of Chicago Press, vol. 22(3), pages 689-722, July.
  8. Barry T. Hirsch, 2004. "What Do Unions Do for Economic Performance?," Journal of Labor Research, Transaction Publishers, vol. 25(3), pages 415-456, July.
  9. Hirsch, Barry T & Macpherson, David A, 2000. "Earnings, Rents, and Competition in the Airline Labor Market," Journal of Labor Economics, University of Chicago Press, vol. 18(1), pages 125-55, January.
  10. Hirsch, Barry, 2003. "Reconsidering Union Wage Effects: Surveying New Evidence on an Old Topic," IZA Discussion Papers 795, Institute for the Study of Labor (IZA).
  11. James T. Bennett & Bruce E. Kaufman, 2004. "What Do Unions Do?: A Twenty-Year Perspective," Journal of Labor Research, Transaction Publishers, vol. 25(3), pages 339-350, July.
  12. David Autor & Frank Levy & Richard Murnane, 2003. "The skill content of recent technological change: an empirical exploration," Proceedings, Federal Reserve Bank of San Francisco, issue Nov.
  13. Neumann, George R & Rissman, Ellen R, 1984. "Where Have All the Union Members Gone?," Journal of Labor Economics, University of Chicago Press, vol. 2(2), pages 175-92, April.
  14. Olivier Blanchard & Francesco Giavazzi, 2001. "Macroeconomic Effects of Regulation and Deregulation in Goods and Labor Markets," NBER Working Papers 8120, National Bureau of Economic Research, Inc.
  15. Martin Neil Baily & Diana Farrell & Ezra Greenberg & Jan-Dirk Henrich & Naoko Jinjo & Maya Jolles & Jaana Remes, 2005. "Increasing global competition and labor productivity: lessons from the U.S. automotive industry," Proceedings, Federal Reserve Bank of San Francisco.
  16. Barry T. Hirsch & Barbara A. Morgan, 1994. "Shareholder risks and returns in union and nonunion firms," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 47(2), pages 302-318, January.
  17. James T. Bennett & Bruce E. Kaufman, 2001. "The Future of Private Sector Unionism in the U.S," Journal of Labor Research, Transaction Publishers, vol. 22(2), pages 227-228, April.
  18. Barry T. Hirsch & Edward J. Schumacher, . "Unions, Wages, and Skills," Working Papers 9606, East Carolina University, Department of Economics.
  19. Hirsch, Barry T, 1991. "Union Coverage and Profitability among U.S. Firms," The Review of Economics and Statistics, MIT Press, vol. 73(1), pages 69-77, February.
  20. Richard B. Freeman, 2005. "From the Webbs to the Web: The Contribution of the Internet to Reviving Union Fortunes," NBER Working Papers 11298, National Bureau of Economic Research, Inc.
  21. Thomas H. Klier, 2005. "Determinants of supplier plant location: evidence from the auto industry," Economic Perspectives, Federal Reserve Bank of Chicago, issue Q III, pages 2-15.
  22. Barry T. Hirsch & David A. Macpherson, 2003. "Union Membership and Coverage Database from the Current Population Survey: Note," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 56(2), pages 349-354, January.
  23. Richard B. Freeman & Edward P. Lazear, 1995. "An Economic Analysis of Works Councils," NBER Chapters, in: Works Councils: Consultation, Representation, and Cooperation in Industrial Relations, pages 27-52 National Bureau of Economic Research, Inc.
  24. William T. Dickens & Jonathan S. Leonard, 1984. "Accounting For The Decline in Union Membership," NBER Working Papers 1275, National Bureau of Economic Research, Inc.
  25. John Logan, 2006. "The Union Avoidance Industry in the United States," British Journal of Industrial Relations, London School of Economics, vol. 44(4), pages 651-675, December.
  26. Hirsch, Barry T. & Prasad, Kislaya, 1995. "Wage-employment determination and a union tax on capital: Can theory and evidence be reconciled?," Economics Letters, Elsevier, vol. 48(1), pages 61-71, April.
  27. Card, David, 1996. "The Effect of Unions on the Structure of Wages: A Longitudinal Analysis," Econometrica, Econometric Society, vol. 64(4), pages 957-79, July.
  28. Steven J. Davis & R. Jason Faberman & John Haltiwanger, 2006. "The Flow Approach to Labor Markets: New Data Sources and Micro-Macro Links," Journal of Economic Perspectives, American Economic Association, vol. 20(3), pages 3-26, Summer.
  29. John DiNardo & David S. Lee, 2004. "Economic Impacts of Unionization on Private Sector Employers: 1984-2001," NBER Working Papers 10598, National Bureau of Economic Research, Inc.
  30. Richard B. Freeman & Joni Hersch & Lawrence Mishel, 2004. "Emerging Labor Market Institutions for the Twenty-First Century," NBER Books, National Bureau of Economic Research, Inc, number free04-1, May.
  31. Alex Bryson & Richard B. Freeman, 2006. "Worker Needs and Voice in the US and the UK," NBER Working Papers 12310, National Bureau of Economic Research, Inc.
  32. John DiNardo & David S. Lee, 2004. "Economic Impacts of New Unionization On Private Sector Employers: 1984-2001," The Quarterly Journal of Economics, MIT Press, vol. 119(4), pages 1383-1441, November.
  33. Addison, John T & Chilton, John B, 1998. "Self-Enforcing Union Contracts: Efficient Investment and Employment," The Journal of Business, University of Chicago Press, vol. 71(3), pages 349-69, July.
  34. Addison, John T & Hirsch, Barry T, 1989. "Union Effects on Productivity, Profits, and Growth: Has the Long Run Arrived?," Journal of Labor Economics, University of Chicago Press, vol. 7(1), pages 72-105, January.
  35. John M. Abowd & Henry S. Farber, 1982. "Job queues and the union status of workers," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 35(3), pages 354-367, April.
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 in new window

Cited by:
  1. Miguel Ricaurte, 2009. "Interindustry Wage Differences: An Empirical Review," Working Papers Central Bank of Chile 525, Central Bank of Chile.
  2. Barry T. Hirsch, 2008. "Wage Gaps Large and Small," Southern Economic Journal, Southern Economic Association, vol. 74(4), pages 914-933, April.
  3. Pierre Brochu & Louis-Philippe Morin, 2011. "Union Membership and Perceived Job Insecurity: 30 Years of Evidence from the American General social Survey," Working Papers 1106E, University of Ottawa, Department of Economics.
  4. Burawoy, Michael, 2008. "The Public Turn: From Labor Process to Labor Movement," Institute for Research on Labor and Employment, Working Paper Series qt7vd7859r, Institute of Industrial Relations, UC Berkeley.
  5. Walsh, Frank & Strobl, Eric, 2009. "Recent Trends in Trade Union Membership in Ireland," The Economic and Social Review, Economic and Social Studies, vol. 40(1), pages 117–138.
  6. Hirsch, Barry, 2013. "An Anatomy of Public Sector Unions," IZA Discussion Papers 7313, Institute for the Study of Labor (IZA).
  7. Fang, Tony & Ge, Ying, 2012. "Unions and firm innovation in China: Synergy or strife?," China Economic Review, Elsevier, vol. 23(1), pages 170-180.
  8. Christian Nsiah & Chen Wu & Walter Mayer, 2012. "An analysis of US State’s export performance in the Asian Market," The Annals of Regional Science, Springer, vol. 49(2), pages 533-550, October.
  9. Edelman, Peter B. & Holzer, Harry J., 2013. "Connecting the Disconnected: Improving Education and Employment Outcomes Among Disadvantaged Youth," IZA Policy Papers 56, Institute for the Study of Labor (IZA).
  10. Greer, Mark, 2009. "Is it the labor unions' fault? Dissecting the causes of the impaired technical efficiencies of the legacy carriers in the United States," Transportation Research Part A: Policy and Practice, Elsevier, vol. 43(9-10), pages 779-789, November.
  11. Miguel Ricaurte, 2010. "The Role of Labor Markets in Structural Change," Working Papers Central Bank of Chile 584, Central Bank of Chile.
  12. Brändle, Tobias & Baumann, Florian, 2013. "Union Bargaining and Intra-Industry Productivity Differentials: Theory and Evidence from Germany," Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 79852, Verein für Socialpolitik / German Economic Association.
  13. Morikawa, Masayuki, 2010. "Labor unions and productivity: An empirical analysis using Japanese firm-level data," Labour Economics, Elsevier, vol. 17(6), pages 1030-1037, December.
  14. Fernando Rios-Avila, 2014. "Unions and Economic Performance in Developing Countries: Case Studies from Latin America," Economics Working Paper Archive wp_787, Levy Economics Institute.
  15. MORIKAWA Masayuki, 2008. "What Do Japanese Unions Do for Productivity?: An Empirical Analysis Using Firm-Level Data," Discussion papers 08027, Research Institute of Economy, Trade and Industry (RIETI).

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp2930. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak).

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 references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link 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 profile, as there may be some citations waiting for confirmation.

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