Transient Jobs and Lifetime Jobs: Dualism in the British Labour Market

How long does a job last in Britain? We find that many workers have very short jobs and many have very long jobs. We estimate that in 1990, 40 percent of men were in jobs that will last 20 years or more. On the other hand, 24 percent were in jobs lasting less than five years. We conclude that the labour market is still capable of offering ‘lifetime jobs’ to many workers. Policy analysis of issues such as reform of the welfare state, pensions, and training should take note that reports of the death of ‘jobs for life’ appear to be exaggerated.     

Fertility,Taxation and Family Policy*

Historically, there is clear evidence of an inverse relationship between female labour supply and fertility. However, the relationship across countries is now positive. Countries like Germany and Italy, with the lowest fertility, also have the lowest female participation rates. This paper analyses the extent to which this can be explained by public policy, in particular taxation and the system of child support. The results suggest that countries which have individual rather than joint taxation, and which support families through child care facilities rather than child payments, are likely to have both higher female labour supply and higher fertility.     

Large Non-Union Companies: How Do They Avoid a Catch 22?

Large non-union companies might be expected to enjoy extensive work-force flexibility deriving from their high-wage, high-involvement strategies. However, where there is a strong local union presence, this might be expected to exert a strong dampening effect on the levels of internal flexibility achieved. Such companies, fearful of union organization, could not then enjoy the freedoms that might be associated with a non-union strategy. Research conducted in the Republic of Ireland on large non-union US companies operating in the electronics industry suggests a conceptual framework indicating how a Catch-22 situation is avoided in these companies.     

A reply to Thomas Mulligan's “critique of Milton Friedman's essay ‘The Social Responsibility of Business to Increase Its Profits’”

Professor Thomas Mulligan undertakes to discredit Milton Friedman's thesis that The Social Responsibility of Business Is to Increase Its Profits. He attempts to do this by moving from Friedman's paradigm characterizing a socially responsible executive as willful and disloyal to a different paradigm, i.e., one emphasizing the consultative and consensus-building role of a socially responsible executive. Mulligan's critique misses the point, first, because even consensus-building executives act contrary to the will of minority shareholders, but even more importantly, because he assumes that the mandate of a shareholder majority brings legitimacy to efforts of corporate managers to utilize corporate wealth in solving social problems. It is the role of our democratic institutions to deal with national agenda issues such as inflation, unemployment, and pollution, not that of the private sector. Corporations and private individuals do have a role to play in enhancing the quality of the human environment, however, and the author suggests a coherent means of developing that role in an effort rescue corporate social responsibility from Mulligan no less than from Friedman. Bill Shaw, Lynette S. Autrey Visiting Professor of Business Ethics at the Jesse H. School of Administration, Rice University, is Professor of Business Law at the University of Texas at Austin. He is staff editor of the American Business Law Journal and the Midwest Law Review. Among his most recent publications are The Structure of the Legal Environment (with Art Wolfe), Environmental Law: Text and Cases, The Global Environment: A Proposal to Eliminate Marine Oil Pollution (With Frank Cross and Brenda Winslett, The Natural Resources Journal), and Comparable Worth and Its Prospects (The Labor Law Journal).     

Middle Managers' Divergent Strategic Activity: An Investigation of Multiple Measures of Network Centrality

abstract    Using a sample of 89 mid-level managers in a US based urban hospital, this study investigates relationships among three measures of network centrality and managers' divergent strategic activity. While prior work has demonstrated a relationship between managers' boundary-spanning responsibilities and strategic activity, inadequate attention has been paid to managers' internal network position. Drawing from established theory, we consider expected network flows associated with three elements of the strategic renewal process. From this, we hypothesize and test relationships among managers' divergent activity and three measures of network centrality. Our findings suggest specific relationships between alternative forms of network centrality and particular elements of the strategic renewal process. Consistent with existing research, the findings also show boundary-spanning managers to be more strategically active than their non-boundary-spanning counterparts.     

“Do Fiscal Deficits Influence Current Accounts? A Case Study of India”

This paper examines the effects of fiscal deficits on the current account deficits in the Indian economy. In many developing countries, fiscal deficits are mostly financed through monetization, causing crowding out of private investment expenditures. However, fiscal deficits in India are mostly financed through official borrowings from various external sources, leading to higher interest payments and outgoings on the external account. Such a policy could eventually precipitate balance of payments crises despite favorable trade account and real exchange rate. Data over three decades for the Indian economy show that, in addition to the real exchange rate and the ratio of private investment to GDP, fiscal deficits significantly contribute to the current account deficits.     

THE REAL WAGE GAP

Over the past year a gap has opened up between the growth of manufacturing productivity and that of real wages. This gap cannot persist indefinitely, but it can be closed in many different ways. The best that can happen is that wage settlements fall while output and productivity accelerate. The worst outcome would be continued stagnation of real output and no deceleration of wages, in which case the required productivity improvement would have to come about through renewed labour shedding. There are worrying signs that this has started to happen. An intermediate solution might involve a fall in the exchange rate, with some improvement in competitiveness boosting real output (so that UK producers get a larger share of buoyant consumer spending) and some rise in prices holding back real wages.
We continue to believe that the most likely outcome is a rise in output and a fall in the rate of wage settlements. In our June forecast this occurs despite a fall in the real exchange rate. In these circumstances we expect the growth of unit labour costs to fall back from its current high level so that the current 3 per cent inflation rate becomes a true "core" rate. But a moderate fall in the real exchange rate may prove hard to achieve, especially if the oil price continues to weaken. We therefore explore what would happen if the required depreciation happens more rapidly, so that interest rates have to remain high to prevent it getting out of control. In this case we would expect lower growth and higher inflation than we forecast in June.     

Book Reviews

Ross H, McLeod (ed.), Indonesia Assessment 1994: Finance as a Key Sector in Indonesia's Development, Research School of Pacific and Asian Studies, The Australian National University, Canberra, and Institute of Southeast Asian Studies, Singapore, 1994, pp. 353. $25.00; S$35.00; A$30.00.

Miranda S. Goeltom, Indonesia's Financial Liberalization: An Analysis of 1981–88 Panel Data, Institute of Southeast Asian Studies, Singapore, 1995, pp. xii + 93.

Joan Hardjono and Charles Warner (eds), In Love with a Nation: Molly Bondan and Indonesia, published by Charles Warner, Picton, NSW, 1995, pp. 256. A$16.95.

ln Love with a Nation is privately published and obtainable from the following Australian suppliers: Gleebooks, 49 Glebe Point Rd, Glebe 2037; Nusantara Bookshop, 72 Maroondah Hwy, Croydon 3136; or from Charles Warner, PO Box 194, Picton 2571. (If ordered from Charles Warner, price including postage is AS20 within Australia; A$25 to Europe, America or Africa; A$23 to Asia, Pacific.)