The impact of organized labor on public employment: A comparative analysis

This paper examines the political economy of public employment, specifically the impact of labor unions on public employment across 20 OECD nations during the 1965–1983 period. A theoretical paradigm based on exchange theory is used to explain the rationale for organized labor’s role in public employment. A model is then presented and tested to explain variation in public employment levels across the 20 nations. The results of the analyses support the central hypothesis that labor union power is positively correlated with public employment. Following the data analysis, the conclusions and implications of the findings are discussed as they pertain to the political economy in advanced industrial democracies.     

Financial Leverage and Shareholder’s Required Returns: Evidence from South Africa Corporate Sector

Recent financial crisis which saw an increase in risk premium and shareholder’s required return around the world has been in part attributed to firms excessive debt leverage. This paper tests the impact of debt leverage on shareholder’s required return in South Africa. The paper specifies dynamic panel models and uses difference generalized method of moment (GMM) estimation technique. The results show that long term debt is positively related to shareholder’s required return. Similarly, total debt is positively related to shareholder’s required return. The results are robust to alternative model specification namely system GMM. Based on the findings, the study suggests that debt leverage is an important risk factor to be priced in equity valuation. The findings also suggest that the dynamic nature of firms’ capital structure decision should not be neglected. The paper contributes to capital structure research by testing Modigliani and Miller proposition two on listed firms in South Africa. Besides, it uses better estimation technique that controls for unobservable firm-specific effects and endogenous problem. In addition, two measures of leverage are used as independent variable compared to a single measure commonly found in the literature.     

Managing human resource shortages in a unionized setting: Best practices in air traffic control

Human resource shortages require effective human resource management (HRM). Findings from research about ongoing labor shortages in air traffic control (ATC) are used to build a preliminary theory of appropriate HRM responses. Our international sample of major ATC agencies generally developed a set of best HRM practices to attract, motivate, and retain human assets. Key factors included (1) cultural and institutional norms, (2) technological change, (3) union responses, and (4) organizational form and structure (e.g., civil service versus commercial firms). While ATC’s rare human aptitudes, lengthy training to develop firm-specific human capital, and lifelong employment may limit the preliminary theory’s general applicability, crucial lessons emerge about human resource planning. This research was conducted with the support of the Social Sciences and Humanities Research Council, the Rice Fellowship, the Ziegler Fellowship, and the Center for International Business Studies at the University of Alberta. We are indebted to the individuals interviewed.     

The Effect of Absentee Ownership on Local Employment Change

Abstract

To determine whether absentee-owned firms destabilize local economies, we examine the relationship between absentee ownership of manufacturing companies and employment change in manufacturing for 109 Pennsylvania towns. This issue arises because some earlier studies find that corporate connections through absentee-owned firms are positively related to local employment growth, whereas other work claims that locally owned operations are more stable. We attempt to reconcile these findings by arguing that absentee ownership is destabilizing only in the case of non-conglomerate firms. Our results show that absentee ownership in fact increases the closure rate of firms, thereby negatively affecting manufacturing employment change. Yet, this relationship differs by the parent company's organizational structure. Employment in branches of non-conglomerate firms is more detrimental than employment in branches of conglomerates — an important qualification of the argument that the “conglomeratization” of advanced industrial societies negatively affects communities.     

Minimum wages and the wessels effect in a monopsony model

The Wessels model suggests that firms respond to increases in the minimum wage rate by decreasing the level of fringe benefits — an action which produces an inefficiency effect that lowers workers’ utility and the supply of labor. Standard models of monopsony, however, argue that wage floors prevent the exercise of market power and increase employment. I show that wage floors, even with fringe benefit curtailment, may increase employment by lowering the marginal expense of labor. Employee utility and employment will rise somewhat but not as much had the firm acted competitively in setting both wages and fringes.     

Testing for state and local government job queues

Bivariate probit estimates with partial observability identify the factors influencing the worker’s decision to seek a state or local government job and the factors influencing the government’s decision to hire particular workers. The estimates routinely confirm the presence of a local job queue but confirm the presence of a state job queue only when the role of unionization is explicitly recognized. Our results suggest that the net benefits from local and state government employment are greater than those from private sector employment. The estimates also indicate that local governments disproportionately hire racial minorities relative to the local governments’ pool of applicants but indicate no such relationship for state governments. The authors thank Dale Belman, Jugal Ghorai, and Matt Higgins for help on this and related work. We also thank the referee and the editor for useful suggestions.     

Good Jobs, Good Deeds: The Gender-Specific Influences of Job Characteristics on Volunteering

While research has shown that having a “good” job significantly promotes formal volunteering, we have limited knowledge of how this paid work-to-volunteer work relationship may differ between men and women. Based on the gender-identification spillover theory, we hypothesize that because of the societal expectations that women should be caring, giving and communal, positive job traits such as authority and autonomy promote women’s volunteering more than men’s. Our analysis of data from the National Survey of Midlife in the United States shows that women who exercise supervisory authority on the job volunteer significantly more hours than women who do not, whereas job authority makes no difference in the number of hours volunteered for men. Meanwhile, job autonomy promotes men’s volunteering, but not women’s. Implications of these and related findings for future research on gender and volunteering are discussed.     

Parental Employment,Shared Parent–Child Activities and Childhood Obesity

We examine the effect of parental employment on child health as measured by children’s percentile body mass index (pBMI). Our investigation reveals that hours of parental employment are important determinants of child health. We find a highly significant role for the influence of fathers’ hours of work on the pBMI. Given that work hours of both mothers and fathers impact child health, ignoring parents’ joint decision making in child health production may lead to biased results. Additionally, we conclude that parental work hours may impact both the quality and quantity of time that parents spend with their children. Specifically, we find that shared parent–child activities such as building or repair work, and reading influence childhood obesity.     

Strategic implications of the information age

conclusion The continued enhancements of information technologies facilitate and increase knowl-edge intensity in organizations. As such, knowledge and information technologies play critical roles in the development of competitive advantage by firms. For example, IT facilitates organizational learning and helps firms move into international markets by making it easier to coordinate geographically dispersed units and operations. Even entrepreneurial new venture firms are moving into international markets earlier in their life cycle (Oviatt and MacDougall, 1977; Zahra et al., 2000). IT has become especially important to smaller, entrepreneurial firms to facilitate their networking and coopera-tive ventures with other firms in order to compete more effectively with much larger firms for major projects. Furthermore, information technologies facilitate these firms’ technological learning, a critical element to their survival and long-term success (Zahra et al., 2000). IT has also helped firms from emerging markets (e.g., Korea, Mexico) compete more effectively against firms from developed markets that have more resources. Thus, IT has helped facilitate the increasing globalization of businesses.     

Legal aspects of exclusive representation: Ruminations on the private-public sector analogy

From the perspective of a management labor lawyer, this article argues that any legitimate theory of employment rights must be founded on the premise that employment is a voluntary relationship governed by mutual consent. In contrast, the erosion of the doctrine of at-will employment and the substitution of its legal antithesis, the tort of wrongful discharge, depend on a conception of employment rights as something the employee possesses at the employer’s expense, that is, without the employer’s consent. The theme of this article is that an employment right does not exist apart from contract. The government cannot violate an employment right unless it prevents a willing employee and a willing employer from making a contract concerning a proper subject on terms satisfactory to both. In public sector employment, the state is one of the parties to the employment contract. In most cases, a public employer cannot be “willing” if the same sovereign or polity has enacted conditions on public employment, that is, has placed limitations on itself. This article analyzes the legal aspects of exclusive union representation and related union security arrangements within this conceptual framework. Member, State Bar of California. Associate, Latham & Watkins, Los Angeles and San Diego. I wish to thank my colleague, Mark W. Smith, for his helpful suggestions and comments during the preparation of this paper. The views expressed here are solely those of the author.     

Computational application of the mathematical theory of democracy to Arrow’s Impossibility Theorem (how dictatorial are Arrow’s dictators?)

The article is based on three findings. The first one is the interrelation between Arrow’s (Social choice and individual values, Wiley, New York, 1951) social choice model and the mathematical theory of democracy discussed by Tangian (Aggregation and representation of preferences, Springer, Berlin, 1991; Soc Choice Welf 11(1):1–82, 1994), with the conclusion that Arrow’s dictators are less harmful than commonly supposed. The second finding is Quesada’s (Public Choice 130:395–400, 2007) estimate of their power as that of two voters, implying that Arrow’s dictators are not more powerful than a chairperson with an additional vote. The third is the model of Athenian democracy (Tangian, Soc Choice Welf 31:537–572, 2008), where indicators of popularity and universality are applied to representatives and representative bodies. In this article, these indicators are used to computationally evaluate the representativeness/non-representativeness of Arrow’s dictators. In particular, it is shown that there always exist Arrow’s dictators who on the average share opinions of a majority, being rather representatives. The same holds for dictators selected by lot, which conforms to the practice of selecting magistrates and presidents by lot in ancient democracies and medieval Italian republics. Computational formulas are derived for finding the optimal “dictator–representatives”.     

Unions,firms, and the return to seniority

Wages generally rise more slowly with experience in union than in nonunion settings. It has been argued that the lower slope of the earnings profiles reflects the preferences of the median worker. It is shown in this paper that the median worker model (assuming a median worker exists) does not lead to a uniformly less steeply sloped earnings profile. Instead, the lower return to seniority reflects the firm’s rational response to the union’s monopoly power. Thus, the lower slope in unionized firms reflects the objectives of firms, not unions, in the bargaining process. I would like to thank Bill Dickens, Bernie Grofman, Shu Kahn, and Donald Martin for useful comments and suggestions.     

PERSPECTIVE ARTICLE: The impact of Nordic countries’ family friendly policies on employment,wages, and children

The Nordic countries at the same time exhibit a remarkably high participation rate of mothers and a more moderate decline in fertility rates compared to other Western countries. This has been attributed to the fact that the welfare state model and, especially, the family friendly policies chosen in the Nordic countries are unique. In this paper we evaluate the impact of Nordic countries’ family friendly policies on employment, wages and children’s well-being. We demonstrate that, although the ‘Nordic model’ has been successful in boosting female employment, it is a costly solution. Furthermore, family-friendly policies mainly directed towards giving mothers the right to be on long paid maternal leave have adverse effects on women’s wages with consequences for gender equality. Indeed, extensive family-friendly schemes may even have created a ‘system-based glass ceiling’ hindering women’s career progression. There is no evidence however of a trade-off between family-friendly policies and family welfare as effects on child development and children’s well-being of publicly provided child-care are found to be modest or even positive.

Effects of Caregiving on Employment and Economic Costs of Chinese Family Caregivers in Canada

A telephone survey with 339 randomly selected Chinese Canadian caregivers examined the employment and economic costs of family caregiving for the elderly. Although the Chinese culture places a strong emphasis on filial obligation, caregiving is not without economic consequences. Caregiver’s age, financial adequacy, and employment, caring for an additional care receiver, and levels of assistance in Activities of Daily Living (ADL), were the predictors for economic costs perceived by family caregivers. Caregiver’s age, caring for an additional care receiver, and care receiver’s financial adequacy were significant predictors for male caregivers. Caregiver’s financial adequacy and higher levels of assistance in ADL were the predictors for female caregivers. Policies to support family caregivers should not just focus on the social aspect, but also the financial needs.     

Assessing the Regional Economic Impact of Higher Education Institutions: An Application to the University of Cardiff

I evaluate the regional and local economic impact of the University of Cardiff, dividing its effects into two major sides: expenditure impacts and knowledge impacts. I review the major tools and methodologies available in the literature to assess the two sides. The expenditure impact in the financial year 2000–2001 is measured through a Keynesian multiplier model developed by the Centre for Advanced Studies in Social Sciences, Cardiff University, in order to compare that same impact in the 1994–1995 financial year. The university’s knowledge impact is assessed through two main variables: (1) employment and destination of graduates, or people impact, and (2) kind of knowledge produced. Cardiff University’s graduates enjoy full-employment, and according to our conceptual framework, Cardiff’s higher education system is classified as “nonactive” positional competition and “social” knowledge production.      

Quantifying the Third Sector in Portugal: An Overview and Evolution from 1997 to 2007

This article presents a global overview of the third sector in Portugal drawing on data from a linked employer–employee database—“Quadros de Pessoal,” which is based on a compulsory annual inquiry to organizations, making it a better source of information than those based on sample surveys and estimates. This study advances on previous overviews by providing more updated numbers for organization size, age, gross revenue and employment levels, as well as their distribution across the ICNPO third sector activity classification. The evolution of these variables from the period 1997 to 2007 is also analyzed. The Portuguese third sector has been fast growing, with revenues amounting to 5.64% of Portugal’s GDP and employment representing 4% of the country’s employment in 2007. It is mainly composed of very small organizations, with diminutive revenues. Perhaps its most striking features are the uneven distribution of employment and revenue and the strong concentration on social services.     

Workplace Policy and Environment,Family Role Quality,and Positive Family-to-Work Spillover

We used role theory to direct our analysis of the association between family-friendly policies, workplace environment, family role quality, and positive spillover from family to work. Taking data from 104 dual-earner couples with children living in Utah, we examined the influence of both partners’ access to family-friendly policies, both partners’ workplace environments, and the family role quality reported by the couple. We found that family role quality was significantly associated with positive family-to-work spillover for men and women. In addition, women’s own workplace culture and the ability of women’s partners to leave work to care for children were associated with women’s positive family-to-work spillover. These findings were viewed through the lens of gender theory and traditionally structured institutions and roles.     

Regional mobility of economists: An extension

We extend Davis and Patterson’s analysis of the incidence and determinants of regional mobility of Ph.D. economists. By exploiting previously collected data, we identify the patterns of regional mobility not only at the point of entry into the labor market for economists who received their doctoral degree in 1968 but also the net mobility of these economists over a 25-year period. The net effects of regional mobility decisions made between graduation in 1968 and year-25 employment in 1993, and between initial professional employment in 1969 and year-25 employment in 1993, are analyzed. Our results suggest that many economists demonstrate a propensity to“nest“ in their degree and first-job regions of employment and that those employed in government service and those with a greater diversity of work experience are more likely to migrate across regions during their careers.     

An alternative test of Kuznets’ hypothesis

This paper uses a novel approach for testing Kuznets’ hypothesis. Following Kuznets’ original insights, we test for an inverted U relationship between employment outside agriculture and income inequality, instead of the traditional focus on GDP per capita and income inequality. Our results, obtained using panel and country by country regressions, do not support Kuznets’ hypothesis.