Works Councils and Unionization: Lessons from South Korea

This study analyzes the impact of effective works councils and unions in large South Korean firms. Following a brief review of economic theory on works councils and the institutional environment of Korean industrial relations, we describe the unique data set used to analyze Korean firm-level labor relations and economic performance. The results of the multivariate analysis show that both effective works councils and unions enhance employee voice on several key personnel practices. In addition, the estimates show that unionization increases wages and reduces turnover, but effective works councils are associated with higher levels of employee satisfaction and somewhat higher productivity. These estimates are consistent with theoretical models that find that carefully designed works councils can enhance employee voice and may increase productivity.     

Unions,Wage Gaps,and Wage Dispersion: New Evidence from the Americas

Using a common methodology, the effects of unions on wage levels and wage dispersion are estimated for two neighboring countries, Bolivia and Chile, and for the United States. The analysis shows that unions have broadly similar effects on the wage distribution within these three economies. The findings suggest that the political economy of unions, coupled with market constraints on labor costs, produce commonality in union wage effects that transcend other economic and institutional differences.     

Globalization and Industrial Relations in East Asia: A Three-Country Comparison

Globalization enhances competitiveness, both at the level of the firm and at the level of the nation. As observed in China, Malaysia, and Korea, this leads management and the state to adopt strategies designed to increase labor effectiveness to the benefit of capital. However, the effect of globalization on industrial relations procedures and substantive outcomes is contingent. Pressure for greater flexibility in the use of labor is ubiquitous, but the outcome is constrained by cultural norms valuing hierarchy and security. State strategies vary by historical circumstance, resource endowments, and internal political dynamics, including the influence of trade unions. While Malaysian industrial relations is heavily constrained by the discipline of high exposure to international capital, in China and Korea, major struggles are shaping the future of workplace and national labor market governance. Thus the extent and impact of globalization vary between countries, resulting in similar preoccupations by policymakers yet leading to variable responses and industrial relations outcomes.     

Unionization structure, licensing and innovation

We show the effects of the unionization structure (viz., decentralized and centralized unions) on a firm's incentive for technology licensing and innovation. The incentive for technology licensing is stronger under decentralized unions. We identify circumstances under which the benefit from licensing creates a stronger incentive for innovation under decentralized unions. If the union's preference for employment is high, the benefit from licensing may create higher incentive for innovation under decentralized unions. However, if the union's preference for wage is high enough, the incentive for innovation is higher under a centralized union irrespective of licensing ex-post innovation. If the centralized union decides whether or not to supply workers to all firms, the possibility of higher innovation under decentralized unions increases. We further show that perfectly substitutable workers can be better off under decentralized unions if the labor productivity depends on the unionization structure, which occurs in our analysis when, e.g., licensing after innovation occurs only under decentralized unions or innovation (with no licensing) occurs only under a centralized union.     

The Legacy of the Interstate Commerce Act and Labor: Legislation, Unionization, and Labor Earnings in Surface Transportation Services

The intended purpose of the 1887 Interstate Commerce Act (ICA) was the establishment of the Interstate Commerce Commission (ICC) as a regulatory agency that initially provided oversight of rate and entry of interstate commerce in the rail industry. The ICC’s jurisdiction later included regulation of trucking and bus transportation. An unintended consequence of ICC regulation was the development of labor markets in these sectors that helped promote labor organization and labor rent sharing. Indeed, some of the most influential unions in American labor history represented workers in ICC-regulated industries. This study examines the ICA and its aftermath as it applies to labor in these industries.     

Unionism in the United States and Other Advanced OECD Countries

In this paper we compare the changing pattern of unionization in OECD countries, reviewing existing evidence and presenting new information on union-nonunion differentials in labor market outcomes in these countries. Our principal source of information are the micro data files of the International Social Survey Programme cross-country surveys of 1985–87. Our analysis shows that U.S. unions have a larger effect on wages than on other outcomes than unions in other OECD countries, and we argue that the high union premium in the United States has contributed to the decline in union density and divergence of the US. industrial relations system     

Union Involvement in Workplace Change: A Comparative Study of Local Unions in Canada and Mexico

This paper examines the sources of local union power to cope with workplace change. Are workplace unions active participants, merely passengers, outright opponents, or entirely excluded from the change process? Drawing on 18 case studies and a survey conducted in the auto and metalworking industries in Mexico and Canada, the results suggest that greater internal solidarity, stronger articulation with other levels of union and community activity and the pursuit of an autonomous agenda all provide the basis for enhanced local union bargaining power in the context of globalization. This general conclusion applies to Canadian as well as Mexican local unions and suggests analytical paths for understanding the construction and renewal of union power.     

The Economics of Unions and Collective Bargaining

This paper reviews recent research on the economics of unions and collective bargaining, emphasizing the implications for human resource management. Research findings on the impact of unions, strategic union avoidance behavior by management, strategic use of labor law by unions and employers, and conflict and conflict resolution in labor relations are discussed. The paper highlights unexploited connections between research on unioun impact and research on strategic behavior.     

Union–Member Relations and Satisfaction with Unions in South Korea

This paper uses a large sample of South Korean union members working in different industries and occupations to test a model of union satisfaction. The results suggest that union–member relations — member representation and union leader effectiveness — are more important than the economic results that unions provide to members. These findings are in line with our general argument that, where unions rely on decentralized collective bargaining as the prime method of employment regulation, they depend heavily on internal union relations for their effectiveness. We contend that, if unions are to limit the decline in their influence, assessing and changing internal union relations should be a priority.     

劳动力外移、国际贸易与产业结构调整——基于1984—2004年中国数据的协整分析与格兰杰因果检验

伴随着经济全球化进程的不断加快,劳动力外移的浪潮不断高涨,对世界经济和国际贸易的发展带来了巨大的促进作用。近年来中国劳动力外移的数量同样迅猛增加,对中国经济的作用日趋彰显。本文在总结前人观点的基础上,利用1984—2004年的数据对中国的劳动力外移和对外贸易进行了协整分析和格兰杰因果检验,得出结论:我国劳动力外移和对外贸易之间的原因视不同的产业分别呈替代和互补关系,从而对我国产业结构的调整提出了不同的要求与发展思路。     

Experience with Company Unions and their Treatment under the Wagner Act: A Four Frames of Reference Analysis

This paper reexamines American experience with company unions (also known as nonunion employee representation plans) before they were banned by the Wagner Act (1935). For the half‐century following the passage of the act, labor historians and industrial relations scholars painted a bleak portrait of company unions as anti‐union sham organizations. Since the 1980s, additional research has documented a more positive side; similarly, concern has grown that the Wagner Act's ban is stifling legitimate employee participation programs. This paper brings new theoretical and empirical evidence to both historical and legal parts of this debate, including examination of company unions through individualist, unitarist, pluralist, and radical frames; demonstration that the pluralists’ view of company unions was more diverse and positive than conventionally portrayed; presentation of new historical evidence and testimony on the company union experience; and a substantially revisionist assessment of the merits of the Wagner Act's ban. In particular, the conclusion is that, given any reasonable weighting of the four frames, the company union ban is overly restrictive and should be modified so companies can implement the positive side of nonunion employee committees but not the negative. The paper ends by noting that the unbalanced and narrowly critical treatment of company unions in the mainline industrial relations tradition is a case study of the field's perhaps fatal post–World War II core intellectual‐normative contradiction—professed inclusiveness of all frames of employment relations but, in practice, attention to and preference for a narrow union‐centric version of one frame.     

Declining Union Strength and Labor Cost Inflation in the 1980s

This paper explores the hypothesis that the declining strength of labor unions underlies the moderation of labor cost inflation in the 1980s, which is not explained by standard Phillips curve equations. Data on union density, union certification and decertification election results, and work stoppages are used as proxies for union strength. No support is found for the declining union strength hypothesis at either the aggregate level (using economywide or union-sector labor cost series) or the industry level.     

Introduction: Labor Market Institutions and the Future Role of Unions

Government regulations and business policies affecting employee relations are on an up ward trend, whereas the role of organized labor in private-sector industrial relations is on a downward trend. The significance of the displacement of private-sector unions in this transformation is not sufficiently addressed in the literature. The papers in this volume, summarized in this introduction, partly respond to this unmet need. We conclude with an agenda for future research about the labor movement, unions, and government in industrial relations     

Political and economic processes in the privatization of the Korea telecommunications industry: A case study of Korea Telecom, 1987–2003

The Korean government completed its privatization of Korea Telecom (KT) in May 2002. Privatization was undertaken at a gradual pace at first mainly because the Korean government did not want to hand over its managerial power to the privatized telecommunications service company, although it announced its plan in 1987. However, the inauguration of the World Trade Organization (WTO) system and the Korean economic crisis of 1997 forced the government to accelerate its full privatization plan. During this process, several main players such as the Korean government, transnational corporations, international organizations, and large domestic conglomerates played important roles. The full privatization of KT is the result of the political, social, and economic demands of these players.     

Wage councils,product markups and wage markdowns: Evidence from Uruguay

In 2005, after a leftist coalition won the national election for the first time, Uruguay returned to sector-level wage bargaining councils with active government participation. We estimate product markups and wage markdowns using firm-level data for the period 2002–2016, and report decreasing wage markdowns and increasing -to a lesser extent- firm-level product markups. We find statistically significant impacts of minimum mandated wages on product markups and wage markdowns, and additional effects of unions on wage markdowns. The evidence suggests that firms operate in monopsonistic labor markets. Though their bargaining power in the labor market was reduced over time as a result of wage councils, firms were able to pass a sizable part of the increases in labor costs to consumers.     

Dominance Effects from Local Competitors: Setting Institutional Parameters for Employment Relations in Multinational Subsidiaries; a Case from the Spanish Supermarket Sector

Dominance effects are normally associated with multinational corporations (MNCs). However, we argue that a strong local competitor can create ‘dominance effects’ setting the institutional parameters for employment relations in multinational subsidiaries. Moreover such an effect can be persistent. In this case the Spanish‐owned El Corte Inglés (ECI) used its power and influence to establish an employer's federation and two ‘yellow unions’. These yellow unions infiltrated the French‐owned MNC Carrefour and most of the Spanish supermarket sector by the early 1980s and continue to dominate collective bargaining rounds and works council elections, marginalizing the main independent trade unions. This has resulted in poor pay and working conditions and a lack of effective employee representation across most of the Spanish supermarket sector. The fact that Carrefour established an international framework agreement to observe union rights in 2001 has as yet not changed this situation.     

Korea's Direct Investments in China: Technology, Experience, and Ownership Factors in Performance

This paper is designed to empirically examine what determines the performance of Korea's foreign direct investment (FDI) in China. Three main determinants are hypothesized to influence the performance of Korea's FDI. They include technology, internationalization experience, and ownership patterns associated with Korea's investments in China. Data were collected from surveys with 91 Korean investors. Our empirical analysis suggests that the labor intensity of technology involved in FDI and the appropriateness of manufacturing technology to the local conditions influence the investment performance. In addition, the results indicate that the internationalization experiences of the Korean investors also affect the profitability of FDI. Another finding of note is that the level of local ownership had a positive impact on performance. But, more interestingly, its effects were moderated by the investor's prior internationalization experiences; in other words, the investors with limited internationalization experiences performed well on a minority ownership venture.     

Race, Ethnicity, Union Attitudes, and Voting Predilections

The research reported here investigates, in a sample of approximately 500 persons, the relationship between individuals' race and/or ethnicity and their union-related attitudes and union vote propensity. As measured by scores on union instrumentality, big labor image, and union governance questions, blacks have the most favorable attitudes toward unions, Hispanics the least favorable. Logistic multiple regression results indicate no difference in union-joining propensity attributable to ethnicity, although several other variables are found to be significantly related to joining predilections.     

Balancing Acts: Dynamics of a Union Coalition in a Labor Management Partnership

This paper analyzes the experience of a set of unions that formed a coalition to engage in coordinated bargaining and to build and sustain a labor management partnership with Kaiser Permanente, a large healthcare provider and insurer. We use qualitative and quantitative data, including member and leader surveys, to explore the experience of the coalition in confronting five key challenges identified through theory and prior research on such partnerships. We find that the coalition has been remarkably successful, under difficult circumstances, in achieving institutional growth for its member unions and in balancing traditional and new union roles and communicating with members. The unions have been less successful in increasing member involvement.     

The Union Wage Effect in Japan

Previous studies point to Japanese labor unions’ lack of bargaining power that results from their organization at an enterprise level. However, a detailed examination of the institutional setting backed by the Labor Standard Law and Trade Union Law reveals that unions have strong bargaining power against deteriorating work conditions. This paper examines the effect of unions on wages using the Japanese General Social Surveys 2000–2003, which cover a period of economic stagnation. We find a robust union wage premium for both males and females. A Cotton–Neumark decomposition reveals that about one‐fifth of union workers’ higher wage is explained by the difference in the union and nonunion wage structures. We also can confirm the union wage compression effect using the DiNardo, Fortin, and Lemieux (1996 ) method. Union workers are likely to think that they will not find jobs with similar compensation packages if they leave their current jobs. In summary, unions in Japan contribute to an increase in the average wage and compress the wage distribution among their workers. This result is reconciled with previous findings by considering the uniqueness of the macroeconomic conditions of the sample period.