Labor Unions Research Articles

Optimal income taxation in unionized labor markets

This paper extends the Diamond (1980) model with labor unions to study optimal income taxation and to analyze whether unions can be desirable for income redistribution if income taxes are optimized. Unions bargain with firms over wages in each sector and firms unilaterally determine employment. Optimal unemployment benefits and optimal income taxes are lower in unionized labor markets. Unions raise the efficiency costs of income redistribution, because unemployment benefits and income taxes raise wage demands, and thereby generate involuntary unemployment. We show that unions are socially desirable only if they represent (low-income) workers whose participation is subsidized on a net basis. By creating implicit taxes on work, unions alleviate the labor-market distortions caused by income taxation. We empirically verify whether (i) participation tax rates are lower if unions are more powerful, and (ii) unions are desirable by compiling our own data set with union densities and participation tax rates for 18 sectors in 23 advanced countries. In line with our theoretical predictions, we find that participation tax rates are lower if unions are stronger. Moreover, the desirability condition for unions is never met empirically. Numerical simulations for the Netherlands confirm that unions are not desirable if income taxes are optimized and optimal participation taxes are lower if unions are stronger.

Advocacy intelligence and competition: Assessing lobbyists' sharing of tactical knowledge in focus group interviews

AbstractAdvocacy intelligence is a critical organizational resource fostering long‐term survival and policy success. Policy‐active interest groups such as non‐profits, business associations and labor unions, seek to maintain their competitive advantage among peers and therefore have incentives to remain secretive about the details of their lobbying strategies and membership mobilization. We empirically evaluate this argument based on knowledge sharing interactions in 12 focus group interviews with approximately 50 representatives of interest groups in the Netherlands, Ireland and Denmark. Our research design manipulates the composition of the focus groups to vary the level of competition for political influence and membership among the participants. Strikingly, we find no evidence that either type of competition hampers knowledge sharing. Instead, our novel data point to three fruitful alternative explanations: the importance of socialization, mentorship and personalities of interest group leaders.

Creating a Significant Learning Experience When Introducing Labor Relations to Students

Despite declines in private-sector union membership in the United States, labor relations remains an essential topic within the field of human resource management. However, most undergraduate students have little experience with labor unions, making it difficult to enhance learning by applying labor relations concepts to their prior experiences. The current lesson addresses this gap by teaching students about labor relations through the exploration of an authentic collective bargaining agreement (CBA) and an analysis of an actual work stoppage (i.e., strike or lockout). Students will learn about how different elements of the CBA influenced negotiations and factors that contributed to a work stoppage, leading to a basic understanding of how the human resource management decisions they make as managers can directly impact organizational outcomes. The lesson also serves as a tool for synthesizing content from throughout the semester in an undergraduate human resource management course.

Hayek on labor unions and restraint of trade

Hayek on labor unions and restraint of trade

Can Partial Growth Coalitions Build Pathways Out of the Middle-Income Trap? The Case of Querétaro, México

Although scholars often portray Mexico as caught in the “middle-income trap,” this description obscures important subnational variation in patterns of economic development. We leverage this variation by examining the case of Querétaro, a state with high levels of structural transformation and economic growth since the 1980s. We reconstruct the historical trajectory of its two leading industries, automotive and aerospace. We observe that while both have cumulatively delivered real developmental gains, each also exhibits a complex mix of strengths and weaknesses. We further find that these industries’ advancements and hindrances over time appear closely related to the kinds of “partial” coalitions — groups of actors from the state, private firms, and civil society organizations such as labor unions — which participate in industry-level decision-making. Both industries saw periods of “upgrading” when the partial coalitions supporting them were expanding their cognitive diversity while avoiding gross imbalances in the distribution of power among their members. They likewise experienced periods of stagnation when either of those coalition conditions underwent major change. These findings suggest that debates on escaping the middle-income trap should consider how changes in partial political coalitions affect policy models and options.

The spillover effect of industrial action on the profitability of platinum mining companies

This study was aimed at determining the effects of industrial action on profitability in the South African platinum mining sector. We compared companies where employees engaged in industrial action (affected companies) to strike-free companies (competing companies). Industrial action refers to strikes by rock-drillers, as these strikes typically result in the shutdown of production at the mines affected. A t-statistics analysis of significant differences in revenue and earnings of affected and non-affected platinum companies was conducted using data from platinum mining companies listed on the Johannesburg Stock Exchange from 2011 to 2015. Contrary to international studies, which suggest that the spillover effects of industrial action positively affect competing companies, our findings show that profits in the platinum sector decrease significantly during strike periods for both affected and competing companies. The results indicate industrial action is a threat to the profitability of all companies, and that employee demands should be prioritized and negotiated before they result in industrial action. Improved dialogue between management, labour unions, and employees in the platinum mining industry is recommended. The study contributes to the scanty literature on the effect of industrial action on the profitability of mining companies in a developing economy.

Reaching into the Community to Interpret Labor History

Reaching into the Community to Interpret Labor History

There is no capitalist conspiracy and the rich are not all‐powerful

There is no capitalist conspiracy and the rich are not all‐powerful

The Red Thread: The Passaic Textile Strike

The Red Thread: The Passaic Textile Strike

Expectations on Labour-Related CSR Reporting: Voices from Labour Unions in Indonesia and Thailand

ABSTRACT This paper examines the viewpoints of labour unions’ leaders in Indonesia and Thailand regarding labour-related corporate social responsibility (CSR) reporting. Fifteen respondents representing leaders from seven labour unions in Indonesia and Thailand were interviewed using semi-structured questions. The results revealed that Indonesian labour unions expected companies to provide a clearly specific section about labour-related CSR in annual reports whereas Thai labour unions expected companies to keep on providing oral disclosures through, for example, meetings in addition to written reports such as annual reports. Employment, Occupational Health and Safety, and Training and Education were considered the most important labour issues to be reported. Equal Remuneration for Women and Men was another issue which was deemed critical to be disclosed in Indonesia. From the lens of ethical stakeholder theory, it appeared that labour unions in the two countries attempted to voice workers’ concerns and facilitate the fulfilment of workers’ information rights. The labour union leaders’ views seemed to be shaped by their ethical belief in how companies should be accountable to workers. The findings of this study can be used by regulators in Indonesia and Thailand as a reference for developing laws which specifically require companies to communicate relevant labour-related CSR information.

Estimating Effects of Wages on Smoking Prevalence Using Labor Unions as Instrumental Variables.

To test for the effects of wages on smoking using labor unions as instrumental variables. We analyzed four waves of the Panel Study of Income Dynamics (2013 to 2019 alternate years). The overall sample included workers aged 18 to 70 years in 2013 and subsamples within blue + clerical/white-collar and private/public sector jobs (N = 37,117 to 8446 person-years). We used two instrumental variables: worker's union membership and states' right-to-work laws. $1 (2019 US dollars) increases in wages-per-hour resulted in 1.3 ( P < 0.001) percentage point decreases in smoking prevalence (8.2% decreases at the smoking mean). Larger effect sizes and strong statistical significance were found for blue-collar + clerical and private-sector subsamples; smaller sizes and insignificance were found for public-sector and white-collar subsamples. Unions increase wages, and higher wages, in turn, reduce smoking. Wages and labor unions are underappreciated social determinants of health.

Moral Economy in the Nazareth Baptist Church, South Africa

Isaiah Shembe founded the Nazareth Baptist Church (NBC) in 1910, and this new institution distinguished itself from mission Christianity not least through the markedly different moral economy. With the church headquarters at the outskirts of Durban (South Africa), the church catered to black Africans, dispossessed of their land and forced into the capitalist labor system. To them, Shembe preached a Protestant work ethic, while at the same time condemning involvement in city life and striving to acquire land and attain economic autonomy for his congregations. With female adherents running away from fathers and husbands, he started out as a 'thief of women', but soon gave religious support to the patriarchal authorities of chiefs, who granted the church land in native reserves in turn. Prohibiting members from joining labor unions, the church connected cities and mines with rural homelands and contributed to the stabilization of the migrant labor system. In addition, Shembe preached moral ethnicity, and hence partook in the creation of Zulu nationalism. The ambiguous moral economy of the NBC persisted during apartheid capitalism and post-apartheid neoliberalism. My essay focuses on preaching and the heterotopic character of the large gatherings of the NBC, and I will also connect church morals with the wider Zulu traditionalist milieu and, given the preoccupation of classic moral economy with riots and revolutions, conclude with some observations on the 2021 unrests in South Africa.

Capital structure and reversible bargaining tools: Evidence from union-sponsored shareholder proposals

We model and analyze the interplay of capital structure and labor union reversible bargaining tools (such as union-sponsored shareholder proposals). Unions counter firms’ ex-post strategic use of debt by employing bargaining tools that can be reversed depending on firm performance. Firms adjust debt ex ante to make underinvestment a credible threat if the bargaining tools are not reversed. The use of reversible bargaining tools is negatively affected by debt, decreases for riskier firms when the state of the economy is low, and reduces the profits of safer firms. Consistently, we find that union-sponsored shareholder proposals are negatively related to leverage, decrease for riskier firms during the 2008–2009 financial crisis, and are negatively associated with the profitability of safer firms.

HRM solutions: a framework for small business owners to manage industrial relations while facilitating labour unionisation mitigation

PurposeSmall business owners require objective solutions to deal with threats of labour unionisation. This study aims to centre on a novel exploration for improving the leadership acumen of small business owners to address labour unionisation. Specifically, small business owners need a theoretical framework that uses best practices from human resource management (HRM) and industrial relations to provide solutions.Design/methodology/approachThe design, methodology and approach reflect post-modernist epistemological and ontological perspectives for conducting systematic literature reviews. A systematic literature review revealed the relationship between small business owners’ leadership, positive industrial relations and HRM policies and procedures. To identify relevant studies in the review, the utilisation of several databases (EBSCO Database, including PsycINFO and Psych studies; Web of Science) and a mix of ranked journals from entrepreneurship, human resources, leadership and organisational behaviour.FindingsThe findings and results in this paper reflect the purpose, methodology and literature analysis culminating in 162,132,000 peer-reviewed studies. A total of 142 peer-reviewed studies met criterion for review. For example, the purpose of this review focused on labour unionisation mitigation for small businesses and HRM solutions. In doing so, the methodology allowed for identification of a novel research topic (i.e. how small business owners mitigate labour unionisation) worthy of further investigation. The sparse findings on labour unionisation mitigation represent small business owners' reticence in creating HRM policies and procedures.Originality/valueThis study contributes research implications for theory and practice by offering small business owners a theoretical framework to address labour unionisation. The framework, centring on HRM solutions, is grounded in social exchange theory to address the novel topic of labour unionisation mitigation in small businesses. This study results suggest that HRM solutions for small business owners provide competitive advantages for employee job satisfaction through a holistic industrial relations approach. In future research, examining other issues discussed in this study can influence the understanding of the relationship between small business owners and industrial relations to increase employee job satisfaction.

The Challenge of Exposing and Ending Health Inequalities through Social and Policy Change: Canadian Experiences

The Canadian health system is often perceived as excellent. However, a closer examination of the political economy of health in Canada shows a radically different picture. It is a picture of persistent inequality and a history of the inability to address such inequality. Despite numerous public policy interventions to address preventable health inequalities—that is, health inequities—this societal problem persists. This research addresses how and why health inequities, especially class, race/ethnicity, and gender health inequities, persist in Canada and how to reduce such differences through public policy action. To address these questions, I performed a critical realist review, focusing on the political economy of health and policy change. Then I conducted a thematic analysis of the interview data gathered from 23 semi-structured interviews with leading Canadian policy academics, activists, and advocates. The results demonstrate that the capitalist economic system; the co-constitutives of capitalism, namely colonialism, racism, and sexism; and maldistributive public policies primarily cause health inequities in Canada. Canada's health inequities reduction requires pushing for redistributive public policies; uniting and strengthening labor unions, civil society groups, and social movements; and engaging in electoral politics. Reducing health inequities may involve struggling within and against capitalism and struggling for socialism.

Employee treatment and Securities Exchange Commission investigations

PurposeThe authors examine the impact of employee litigation on Securities Action Lawsuits. The authors study whether frequently sued firms are more likely to be investigated by Securities Exchange Commission (SEC). The authors study how labor relations are crucial to corporate governance.Design/methodology/approachThe authors use hand-collected datasets of employee violations, misconducts and lawsuits and test whether bad employee treatment increases the likelihood of SEC probe. The authors' methodology includes panel fixed effects, as well as alternative measures of employee mistreatment and SEC case.FindingsThe authors find that with each increase in employee dispute increases the likelihood of the firm being investigated by the SEC. The authors find that geographically dispersed firms are more likely to be investigated by the SEC when facing employee disputes and that more labor union coverage and a higher unemployment rate triggers more employee allegations and labor-related lawsuits.Originality/valueThe authors' study is the first to investigate how employee relations affect firms involving federal investigation. The authors aim to contribute to the literature by studying (i) the relation between employee mistreatment and legal challenges, (ii) how firm characteristics affect the path from employee disputes to securities class actions and (iii) the impact of employee mistreatment on the corporate governance.

State Labor Laws and Government Responsiveness to Public Opinion

We investigate the effects of states’ labor laws, which can enhance or diminish the political power of public and private sector labor unions, on government responsiveness to public opinion. Drawing on newly developed measures of public opinion and policy liberalism in the US states over time, we leverage differences in the timing of law enactments across the states and find that labor laws impact government responsiveness in distinct ways. States that adopt right-to-work laws that lessen private sector union influence enact economic policies that are more conservative than public opinion, whereas states that adopt mandatory collective bargaining laws for public sector employees enact economic policies that are more liberal than opinion. These findings are consistent across a variety of different model specifications, timeframes, and measurement techniques and have substantively important implications for understanding the impact of government policies on the power of organized interests and the dynamics of political representation in American democracy.

Mobilizing within and beyond the Labor Union: A Case of Precarious Workers’ Collective Actions in North Africa

Drawing on a qualitative analysis of a group of mobilized precarious workers in Tunisia’s public sector, the author asks how workers’ collective actions are shaped by and, at the same time, can act upon labor unions’ responses to them. Findings suggest that unions can enable and simultaneously constrain precarious workers’ collective actions. More important, workers learn from their interactions with the union, and this learning process can contribute to innovations in workers’ mobilizing structure and repertoire of actions. The Tunisian case contributes to the debate on the relationship between precarious workers and institutionalized actors as well as to the study of mobilized precarious workers by elucidating the ways in which the workers’ embedded and innovative agency plays out within and beyond a well-established labor union.

Special issue: labour unions in the Global South in times of neoliberalism/Les syndicats du Sud global à l’ère néolibérale

ABSTRACT In this introduction to the Special Issue on ‘Labour unions in the Global South in times of neoliberalism’, we argue that trade unions have emerged from a historical specific context, i.e. a specific setting of relations of production. We understand trade unionism not as a fixed institutional and organizational form, but as a tool that provides manifold possibilities of adaption. Studying the forms it takes and the processes of its adaption, also outside its milieu of historical origin, allows us to widen our understanding of the organization and mobilization of workers worldwide, including those who do not work in secured forms of wage labour.

ZANU(PF)’s Survival Strategies and the Co-option of Civil Society, 2000–2018

The Zimbabwe African National Union (Patriotic Front) (ZANU[PF]) regime’s survival strategies have been misleadingly presented as relying mainly upon political violence. This neglects analysis focusing on the ZANU(PF) regime’s non-violent survival strategies, which have also been key to its longevity. While a growing body of literature discusses ZANU(PF) non-violent strategies, including patriotic history, cultural nationalism and provision of land for housing, it has missed much of what has kept ZANU(PF) in power. The existing studies failed to go beyond the idea that ZANU(PF) actors are deeply cynical and only interested in ‘power’, not ‘believers’ in their own ideology or responsive to people’s needs. Using the cases of ZANU(PF)’s creation and co-optation of civil society organisations that challenge ‘genuine’ ones for advocacy space, especially labour unions and students’ unions between 2000 and 2018, this study makes a twofold contribution to the literature on ZANU(PF)’s political survival. It demonstrates the importance of civil society engagement as a non-violent strategy in ensuring ZANU(PF)’s political survival and that ZANU(PF)’s political project is ideological in addition to being about staying in power. The article concludes that ZANU(PF)’s strategies in relation to civil society were equally critical for the regime’s survival in that they necessarily complemented the violent strategies and worked in its favour by disorienting citizen objections and mobilising popular support.