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What do indebted employees do? Financialisation and the decline of industrial action

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  • Giorgos Gouzoulis

Abstract

While isolated episodes of work stoppages keep occurring, aggregate industrial action rates have been on the decline over the last five decades. Attempts to explain this trend centre on the short‐term effects of the business cycle and the long‐term impacts of labour market liberalisation, deindustrialisation and globalisation. This paper argues that household indebtedness is a missing piece of the puzzle. Since indebted employees tend to become self‐disciplined at the workplace on the fear of losing their job and defaulting, this paper argues that the post‐1970 rise of household financialisation is associated with the decline of strike activity. The econometric evidence reported provides strong support to this argument for the cases of Japan, Korea, Sweden, the United States and the United Kingdom over the period 1970–2018.

Suggested Citation

  • Giorgos Gouzoulis, 2023. "What do indebted employees do? Financialisation and the decline of industrial action," Industrial Relations Journal, Wiley Blackwell, vol. 54(1), pages 71-94, January.
    • Handle: RePEc:bla:indrel:v:54:y:2023:i:1:p:71-94
    DOI: 10.1111/irj.12391
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    References listed on IDEAS

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    5. Andy Hodder, 2026. "The Methodological Challenges of Measuring the Duration of Strikes: Insights From Canada 1960–2024," Industrial Relations Journal, Wiley Blackwell, vol. 57(1), pages 111-124, January.
    6. Ricardo Barradas, 2025. "Why are (financialised) workers becoming more resigned and conformist and less claimant? Empirical evidence from Portugal," Economic and Industrial Democracy, Department of Economic History, Uppsala University, Sweden, vol. 46(4), pages 910-941, November.
    7. Giorgos Gouzoulis & Panagiotis (Takis) Iliopoulos & Giorgos Galanis, 2025. "Financialisation, Underemployment and the Disconnected Greek Capitalism," Industrial Relations Journal, Wiley Blackwell, vol. 56(2), pages 158-172, March.
    8. Giorgos Gouzoulis & Iris Nikolopoulou, 2026. "Losing Unequally: Financialisation, Productivity and the Finance Wage Premium," Industrial Relations Journal, Wiley Blackwell, vol. 57(1), pages 32-46, January.

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