In Through The Out Door: Critiquing The Internal Labour Market Concept

Abstract

The institutional approach to studying labour markets has been hamstrung by its dual purpose of explaining labour markets and countering neoclassical labour market theory. We argue that institutional labour market theory should relinquish its usual opening critique of neoclassical economics and that it would benefit significantly by drawing from the disciplines of organisation theory and geography. Such an approach builds a conceptualisation of labour markets that does not use the concept of an external labour market drawn from neoclassical economics. We build our argument through an examination of the central institutionalist internal labour market concept. In doing so, we challenge the idea that labour markets can be understood in internal and external terms. Instead, we propose that the labour market at the level of a single employer is interconstitutive with the level of labour markets of employers collectively. Through this analysis, this article offers insights into related spatial challenges facing institutional labour market theory that centre on the organisation-environment relation.