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Shirking the Issue? Efficiency wages, work discipline and full employment

  • David Spencer
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    This paper assesses recent neoclassical and radical contributions to the analysis of unemployment as a labour disciplinary device, in particular, those of Shapiro & Stiglitz and Bowles & Gintis. These authors share a common set of premises, notably on the conception of the effort decision, that present severe obstacles to the understanding of productivity constraints on full employment. The models of Shapiro & Stiglitz and Bowles & Gintis identify a specific 'asymptote problem' in which the achievement of full employment immediately triggers infinite (and hence unsustainable) wage increases. The premise that workers find work subjectively costly to perform effectively rules out the possibility for full employment. But this view fails to take into account the actual constitution of work motives. To the extent that work effort may be induced independently of dismissal threats, high work intensity may in fact be undermined by high unemployment. By taking work avoidance as given, the labour extraction literature forecloses consideration of the possibilities offered by alternative work organisation for removing unemployment as a worker disciplinary device.

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    File URL: http://www.tandfonline.com/doi/abs/10.1080/09538250220147868
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    Article provided by Taylor & Francis Journals in its journal Review of Political Economy.

    Volume (Year): 14 (2002)
    Issue (Month): 3 ()
    Pages: 313-327

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    Handle: RePEc:taf:revpoe:v:14:y:2002:i:3:p:313-327
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    1. Bowles, Samuel & Boyer, Robert, 1988. "Labor Discipline and Aggregate Demand: A Macroeconomic Model," American Economic Review, American Economic Association, vol. 78(2), pages 395-400, May.
    2. Ernst Fehr & Simon G�chter, 2000. "Fairness and Retaliation: The Economics of Reciprocity," Journal of Economic Perspectives, American Economic Association, vol. 14(3), pages 159-181, Summer.
    3. Shapiro, Carl & Stiglitz, Joseph E, 1984. "Equilibrium Unemployment as a Worker Discipline Device," American Economic Review, American Economic Association, vol. 74(3), pages 433-44, June.
    4. Herbert Gintis, 1995. "Taking Effort Seriously: A Reply To Currie And Steedman," Metroeconomica, Wiley Blackwell, vol. 46(2), pages 202-210, 06.
    5. Samuel Bowles and Robert Boyer., 1988. "Labor Discipline and Aggregate Demand: A Macroeconomic Model," Economics Working Papers 8875, University of California at Berkeley.
    6. Edwards, P. K., 1990. "The politics of conflict and consent : How the labor contract really works," Journal of Economic Behavior & Organization, Elsevier, vol. 13(1), pages 41-61, January.
    7. Samuel Bowles, 1998. "Endogenous Preferences: The Cultural Consequences of Markets and Other Economic Institutions," Journal of Economic Literature, American Economic Association, vol. 36(1), pages 75-111, March.
    8. Akerlof, George A, 1982. "Labor Contracts as Partial Gift Exchange," The Quarterly Journal of Economics, MIT Press, vol. 97(4), pages 543-69, November.
    9. Ichniowski, Casey & Shaw, Kathryn & Prennushi, Giovanna, 1997. "The Effects of Human Resource Management Practices on Productivity: A Study of Steel Finishing Lines," American Economic Review, American Economic Association, vol. 87(3), pages 291-313, June.
    10. Samuel Bowles & Herbert Gintis, 1994. "Credit Market Imperfections And The Incidence Of Worker-Owned Firms," Metroeconomica, Wiley Blackwell, vol. 45(3), pages 209-223, October.
    11. Alchian, Armen A & Demsetz, Harold, 1972. "Production , Information Costs, and Economic Organization," American Economic Review, American Economic Association, vol. 62(5), pages 777-95, December.
    12. Marshall, M G, 1998. "Scottish Economic Thought and the High Wage Economy: Hume, Smith and McCulloch on Wages and Work Motivation," Scottish Journal of Political Economy, Scottish Economic Society, vol. 45(3), pages 309-28, August.
    13. Bowles, Samuel & Boyer, Robert, 1988. "Labor Discipline and Aggregate Demand: A Macroeconomic Model," Department of Economics, Working Paper Series qt8sb2623g, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
    14. Green, Francis, 1988. "Neoclassical and Marxian Conceptions of Production," Cambridge Journal of Economics, Oxford University Press, vol. 12(3), pages 299-312, September.
    15. Stiglitz, Joseph E, 1987. "The Causes and Consequences of the Dependence of Quality on Price," Journal of Economic Literature, American Economic Association, vol. 25(1), pages 1-48, March.
    16. Arestis, Philip & Sawyer, Malcolm, 1998. "Keynesian Economic Policies for the New Millennium," Economic Journal, Royal Economic Society, vol. 108(446), pages 181-95, January.
    17. Leslie, Derek, 1995. "On the Proper Use of Ordinal Variables in Labour Market Models," The Manchester School of Economic & Social Studies, University of Manchester, vol. 63(2), pages 196-205, June.
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