information on strikes and union settlements patterns of coverage in a newspaper of record the authors investigate whether the new york times coverage of strikes and non strike wage settlements in large bargaining units changed during the 1980s a time when a transformation of industrial relations is said to have taken place although the total number of new york times articles on such events declined during the 1980s the authors find that when appropriate control variables are included in the analysis the apparent drop in coverage disappears important variables determining the extent of news coverage were occurrence of a strike strike duration number of workers involved occurrence of federal intervention key industry status that is whether the affected industry was among those industries identified as exceptionally important for wage setting and proximity to new york city they speculate that the reduced number of articles may simply reflect a decreased incidence of strikes

union power cost of job loss and workers effort the authors hypothesize that the effectiveness of external threats in raising workers effort is mediated by among other labor market conditions the presence or absence of a powerful union in particular they argue that because powerful unions reduce the potency of the external threat of job loss by making it more difficult for employers to dismiss workers the pace of work is less responsive to such a threat in strongly unionized plants than in weakly unionized plants the results of an analysis of data from the 1990 workplace industrial relations survey in britain support this hypothesis the analysis also yields evidence that effort is increased where workers are rewarded individually according to results and where there are various communication channels between workers and management

neoclassical and marxian conceptions of production incorporating information deficiencies into the neoclassical paradigm has introduced some broad similarities with the marxian analysis of the labor process both approaches predict the existence of a variety of contractual regimes and that workers with equal productivities can be adjudged unequal in the market place and while the marxian approach sees unemployment as inevitable the new neoclassical models also allow for equilibrium unemployment these similarities and areas of divergence in the assessment of productive efficiency and welfare are explored a crucial difference arises from the individualism of the neoclassical model as opposed to the class approach in the marxian model copyright 1988 by oxford university press

does product market competition increase strike activity evidence from the uk although many studies have examined the effect of labour market characteristics macroeconomic fluctuations and workplace level factors on strike activity much less is known about industry level determinants of industrial conflict and in particular the role of product market competition i examine the effect of competition on strike activity using evidence from a natural experiment of policy reform the introduction of cartel legislation in the uk in the late 1950s my econometric analysis which takes advantage of the fact that different industries were affected to varying degrees by cartel policy establishes that both the number of strikes and the number of working days lost as a result of strikes increased significantly when competition intensified after the abolition of cartels i propose an interpretation of these results with reference to theoretical models of bargaining with asymmetric information

imperfect information and strikes an analysis of canadian experience 1967 82 to test their hypothesis that the propensity to strike is affected less by the actual balance of bargaining power than by the parties uncertainty about their relative power the authors perform a probit analysis of data on 1 871 collective agreements negotiated in the canadian manufacturing sector between 1967 and 1982 they find consistent with their hypothesis that some characteristics of individual bargaining units the relevant industries and the economy as a whole that affect both the quantity and reliability of information needed to assess relative bargaining power do have significant value in predicting strike incidence across industries and over time

strikes and holdouts in wage bargaining theory and data we develop a private information model of union contract negotiations in which disputes signal a firm s willingness to pay previous models have assumed that all labor disputes take the form of a strike yet a prominent feature of u s collective bargaining is the holdout negotiations often continue without a strike after the contract has expired production continues with workers paid according to the expired contract we analyze the union s decision to strike or hold out and highlight its importance to strike activity strikes are more likely to occur after a drop in the real wage or a decline in unemployment

employment rents and the incidence of strikes a new measure of labor market tightness on workers behavior the employment rent is modeled as a determinant of workplace conflict an empirical estimate of the employment rent workers expected cost of job loss is calculated it is argued that the cost of job loss affects strike incidence this relationship is tested by estimating an econometric model of strike incidence for the united states from 1955 to 1983 the cost of job loss is shown to explain a large percentage of the variation in strike incidence the cost of job loss is a far superior explanatory variable than the unemployment rate which is commonly used in strike models copyright 1987 by mit press

incentives pay and performance a study of australian employees the paper analyses the determinants of self reported work effort using a 1988 survery of australian employees while controlling for the endogeneity of the firm s choice of incentives and pay it is found that direct incentive schemes have predicted effects and the efficiency wage hypothesis is supported pay and work effort are positively correlated two efficiency wage models are tested akerlof s gift exchange model and work discipline arguments regarding monitoring difficulties and threats of dismissal the latter argument is broadly consistent with the data

efficiency wages interfirm comparison and unemployment the paper presents an efficiency wage model where worker effort depends on own wages relative both to wages of other workers in the firm and to similar workers in other firms first we show how the solow conditions are modified if internal comparison effects are at work second we discuss the effect of internal wage comparison on wage inequality within firms third we study unemployment and relative wage determination within a general equilibrium model and analyze the effect of technological change and various tax policies on equilibrium unemployment and relative wages finally the short run effects of aggregate demand shocks are analyzed a popular argument for the existence of involuntary unemployment is that a worker s effort rises with wages giving employers incentives to set wages above market clearing levels it is often assumed that the worker s effort is a function of the wage level with no reference to the size of the wage in comparison with that received by other workers yet such comparisons are likely to influence an individual in his effort choice if this is the case then it seems equally likely that workers compare themselves with others both internal and external to their place of work this paper contributes to the efficiency wage literature by providing an understanding of wage setting and unemployment determination within a model where workers efforts depend on their wage relative to both the wages of other workers at the same firm and to the wages of similar workers at other firms

inflation and social consensus in the seventies it is widely believed that the two oil price shocks of the i 970s played a major role in the increase in inflation in industrial countries while this hypothesis is consistent with the timing of changes in inflation at the global level it seems to break down when applied to individual countries cross sectionally for example over the period i973 9 switzerland had an average inflation rate of 4 7 while in neighbouring italy inflation averaged i5 6 over the same period furthermore inflation in the pre opec period i97i 2 was actually higher in switzerland than in italy it seems that a supply shock explanation of inflation in the seventies also requires an explanation of why different countries responded so differently to a similar set of shocks at the world level the purpose of this paper is to offer such an explanation and to test the hypothesis with a cross sectional equation accounting for differences in average inflation rates over the period i973 9 in eighteen oecd countries this time period includes the year of the first opec shock i 973 and the following six years up to the time of the second opec shock the hypothesis to be tested is set in the framework of a model similar to that of brunner et al i 980 the key features of the brunner model are that the adjustment of real wage expectations is subject to lags and that labour supply is positively related to the difference between the perceived real wage and the expected or target real wage given these two assumptions a negative supply shock gives rise to a period of stagflation whose intensity will be greater the slower is the speed of adjustment of real wage expectations the model of this paper extends the brunner model in three ways first across countries the speed of adjustment of real wage expectations or targets is assumed to depend positively on the degree of social consensus as proxied negatively by an indicator of average long run strike activity second the model allows for the possibility of inflation inertia or systematically incorrect inflation expectations as well as a sluggish adjustment of real wage expectations third the model incorporates the hypothesis that money supply growth will vary across countries according to variations in inflationary pressures as perceived by governments the first section of the paper provides a discussion of the rationale for the key proposition regarding strikes and social consensus as well as a brief discussion of the role of wage bargaining institutions section ii develops a theoretical model which yields a reduced form cross sectional equation relating the average i 973 9

do direct democratic procedures lead to higher acceptance than political representation are direct democratic decisions more acceptable to voters than decisions arrived at through representative procedures we conduct an experimental online vignette study with a german sample to investigate how voters acceptance of a political decision depends on the process through which it is reached for a set of different issues we investigate how acceptance varies depending on whether the decision is the result of a direct democratic institution a party in a representative democracy or an expert committee our results show that for important issues direct democracy generates greater acceptance this finding holds particularly for those voters who do not agree with a collectively chosen outcome however if the topic is of limited importance to the voters acceptance does not differ between the mechanisms our results imply that a combination of representative democracy and direct democracy conditional on the distribution of issue importance among the electorate may be optimal with regard to acceptance of political decisions

legitimacy and multi level institutional environments implications for foreign subsidiary ownership structure in this study we examine from an institutional perspective the legitimacy rationale behind the choice of subsidiary ownership structure among multinational corporations mncs we suggest that when under a strong pressure to conform at the host country and local industry levels of their institutional environment mncs are likely to take a lower ownership stake in exchange for external legitimacy in the host country or local industry that their foreign subsidiaries are entering we also suggest that mncs are likely to take a higher ownership stake in response to strong internal pressure to sustain their internal legitimacy at the corporate level of their institutional environment we also propose that mncs are more likely to exchange ownership for legitimacy in local industries than in host countries and in local markets with a high level of political instability than in those with a low level of political instability these propositions are generally supported by our analysis of 4451 subsidiaries established by 898 japanese mncs that operated in 39 countries across 52 industries two digit sic between 1988 and 1999

is strike behavior cyclical we examine cyclicality of strike frequency and incidence using canadian data on strikes and contracts total strike frequency exhibits significant procyclicality to which within contract strikes contribute appreciably evidence is weaker for procyclical behavior of contract expiry strikes both in total and disaggregated by issue strike incidence is also procyclical particularly in manufacturing though the procyclicality here is confined to strikes over nonwage issues these results mirror those obtained by analyzing the frequency of strikes in the contract data industry specific cyclical variables positively affect strike incidence in manufacturing but region specific variables have no effect

global equity and environmental crisis an argument for reducing working hours in the north abstract is an improvement in the distribution of income between north and south compatible with environmental reconstruction to date economic growth rather than redistribution has been the dominant strategy for redressing global inequality but environmental constraints on growth at least in the north may prove desirable this paper argues that one strategy for reconciling these two goals is for the north to take productivity increases in the form of leisure time rather than increased output it discusses the feasibility of such an approach

irrational workers the moral economy of labor protest in egypt after comparing the predictions of marxist moral economy and rational choice theories concerning collective actions by workers in egypt in the period since the 1952 free officers coup this article concludes that a moral economy perspective is best able to explain the nature and frequency of these protests the supporting evidence is the correlation between labor protest and violations of workers feelings of entitlement as manifest in declining real wages or disruptions to established patterns of wage differentials the targeting of state institutions combined with the fact that workers have eschewed actual production stoppages in favor of symbolic protests indicates a view of reciprocal rights and obligations between themselves and the state the latter reinforces the moral economy by combining significant concessions with its repressive response to labor protests marxism proves unable to explain the largely defensive and reactive nature of labor protest while rational choice theory is reduced to efforts to quantify workers reactions to this repression

effect of strike activity on firm value the article examines the stock market s reaction to labor management problems and employee strikes a discussion is presented about various categories of strike costs and cumulative abnormal return

unemployment long term employment relations and productivity growth using an effort regulation type of efficiency wage model it is demonstrated that a firm may respond to slackening labor markets by acting to increase the intensity with which workers work the magnitude of this work intensity effect depends on the structure of employment relations where long term employment relations are prevalent the effect of labor market slack on work intensity may be diminished these propositions are tested empirically by estimating the effects unemployment and long term employment have on productivity growth in two digit manufacturing industries copyright 1987 by mit press

business ascendancy and economic impasse a structural retrospective on conservative economics 1979 87 conservatives have been waging economic revolution since the late carter years have they succeeded some argue in the affirmative pointing to lower rates of inflation and the long expansion since early 1983 insisting that the fundamentals are sound others argue in the negative emphasizing the huge twin trade and federal budget deficits and the financial fragility underscored by the october 1987 stock market crash warning that the party s over both sides of this argument concentrate primarily on short term phenomena in the 1980s neither pays much attention to the experience of the conservative regime since 1979 in long term historical perspective ronald reagan and the early architects of conservative economic policy made no such mistake they sought their place in the history books as institutional innovators not economic tinkerers in this light scrutiny of the usual cyclical macroeconomic indicators may miss far reaching changes in economic structure which promise a sustained economic expansion in years to come the budget and trade imbalances of the late 1980s for example may reflect nothing more than the growing pains of a new economic order whose long run prospects are as bright as the reagan administration promised had the economic record of the new deal been evaluated in the eighth year of roosevelt s presidency one may doubt that we would have found in the standard economic aggregates signs of the profound institutional changes which were to provide the foundations for the long postwar boom

an organizational model for understanding internationalization processes we propose an organizational model for understanding internationalization processes we argue that these processes differ with the type of organization we compare the internationalization processes of three organization types the mass production organization the disaggregated production organization and the project based organization each organization type responds differently to critical elements of the internationalization process namely the focus of entry the degree of presence and physical presence requirements in the foreign market which in turn influence what modal forms are adopted as the process progresses consequently we observe different approaches to resource commitment in the foreign market over time

logit estimates of strike incidence from canadian contract data logit estimates of strike incidence are made based on a unique and comprehensive data set of 2 437 collective agreements the appropriate level of aggregation since that is where bargaining occurs the results are interpreted through a theoretical framework emphasizing that strikes are more likely when the joint costs of using the strike mechanism are low relative to the cost of alternative mechanisms for achieving the same purposes such functions of strikes are to generate information elicit truth telling establish reputations provide catharsis and solve intraorganizational conflict

the case for responsible parties electoral platform convergence is perceived unfavorably by both the popular press and many academic scholars arguably to paraphrase it does not provide enough choice between candidates this article provides a formal account of the perceived negative effects of platform convergence we show that when parties do not know voters preferences precisely all voters ex ante prefer some platform divergence to convergence at the ex ante median after characterizing the unique symmetric equilibrium of competition between responsible policy motivated parties we conclude that all voters ex ante prefer responsible parties to opportunistic purely office motivated ones when parties are sufficiently ideologically polarized that platforms diverge but not so polarized that they diverge excessively however greater polarization increases the scope for office benefits as an instrument for institutional design we calculate the socially optimal level of platform divergence and show that office benefits can be used to achieve this first best outcome if parties are sufficiently ideologically polarized

economies of scale in services a study of multinational insurers this study investigates whether multinational insurers achieve economies of scale using a time series cross sectional design it analyzes the relationship between expenses and output of multinational insurers the study finds that multinational insurers achieve economies of scale only up to a point and rather than benefitting from scale the most internationally diverse insurers suffer diseconomies the conclusion is that the benefits of extensive foreign acquisitions by insurers are questionable

the role of path dependency and managerial intentionality a perspective on international business research several decades of research in the field of international business have advanced various theories and studies on the internationalization of firms our assessment of the literature on internationalization shows that the focus has been primarily on path dependency and learning based aspects of internationalization while managerial intentionality and the possibility of managers making deliberate strategic choices towards further internationalization have not been very prominent in the ib literature we argue that internationalization paths and processes should be approached as a joint outcome of management intentionality and experience based learning in other words managers are assumed to have the ability and the intention to influence the evolutionary paths of the firm we derive a future research agenda that calls for the pursuit of this promising and emergent research stream moreover we develop a model integrating managerial intentionality knowledge experience and other factors institutional and selection forces to explain heterogeneous outcomes of internationalization positions paths and processes

performance and survival of joint ventures with non conventional ownership structures the international joint venture jv literature has focused on two parent jvs formed between one foreign and one local firm yet other types of jvs exist this paper identifies four distinct forms of jvs based on the jv partners nationality and equity affiliation these are i jvs that are formed between affiliated home country based firms ii jvs that are formed between unaffiliated home country based firmsl iii jvs that are formed between home country based and local firms and iv jvs that are formed between home country and third country based firms our analysis of 737 japanese jvs in asia demonstrates that the conventionally assumed form of jv represented only 30 percent of the total further each of the four jv forms significantly differed in terms of incidence performance and survival likelihood

a near rational model of the business cycle with wage and price inertia this paper presents a model in which insignificantly suboptimal behavior causes aggregate demand shocks to have significant real effects the individual loss to agents with inertial price wage behavior is second order in terms of the parameter describing the shock while the effect on real economic variables is first order thus significant changes in business activity can be generated by anticipated money supply changes provided that some agents are willing to engage in nonmaximizing behavior which results in small losses

the experience factor in foreign market entry behavior of service firms the paper examines the effect of international experience on service firms selection of foreign markets and entry modes the investigation utilizes survey date from 151 united states based service firms results on market selection suggest that as their experience increases and becomes geographically more diversified service firms tend to choose markets that are culturally less similar to their home country on entry mode choice the paper departs from traditional linear conceptualizations and hypothesizes a u shaped relationship between experience and propensity for integrated entry modes results generally support the hypothesis the paper explains these findings and describes how service firms resemble and differ from manufacturing firms in their foreign market entry behavior

are wages too low empirical implications of efficiency wage models firms may pay efficiency wages to enhance productivity the conventional presumption is that efficiency wages are inefficiently high because they lead to unemployment that is also inefficiently high government policies that lower wages raise output using a simple and general efficiency wage model this paper finds a necessary and sufficient condition for the opposite conclusion if the condition holds wages are inefficiently low leading to productivity that is also inefficiently low it is the high wage policies that raise output even if they also lower employment published empirical results support the condition no evidence is found for the conventional presumption

the globalization of service multinationals in the triad regions japan western europe and north america in this study we empirically investigate the determinants of foreign direct investment of service multinationals based in the triad regions japan western europe and north america foreign investment decisions of 168 of the largest service firms in nine service industries over the period 1976 1986 are analyzed and hypotheses that are developed based on findings of manufacturing fdi and studies of single service industries are tested using a logistic regression model the applicability of the mne fdi theories to service mnes is tested empirically over a broad range of mne home countries and service industries differences in the international behavior of service mnes based in different countries are uncovered and analyzed

strikes are more common in countries with majoritarian electoral systems strikes are more common in those oecd countries where the legislature is elected in single member districts smd than in those where it is elected by proportional representation pr furthermore more working days are lost due to industrial conflict in countries with smd i suggest a politico economic explanation for these rarely noticed empirical regularities further empirical testing including controls drawn from previous strike research reveals that they hold up in a variety of econometric specifications

union competition and strikes the need for analysis at the sector level international comparative research has found that strike incidence is higher where two or more unions bargain with an employer multi unionism as is common in most european countries than where only one union does all else equal two proposed explanations for this relationship both invoking inter union rivalry as the main dynamic are that under multi unionism unions a make propagandistic use of strikes to attract members or b compete with each other by bidding up bargaining demands to date the evidence bearing on these hypotheses has been equivocal because the author argues researchers have focused on activity at the national level rather than at the lower levels that are more commonly the nexus for strike formation the author performs empirical tests using industry sector level data for seven european countries for the years 1990 2006 and finds evidence clearly favoring the competitive bargaining hypothesis over the propaganda hypothesis

a review of research on the growth of multinational enterprises a penrosean lens abstract we provide a comprehensive review of the growth of multinational enterprises mnes based on a quarter century 25 years of scholarly international business publications we synthesize research insights on the determinants of the growth of mnes through the lens of penrose s theory of firm growth which is the most influential theoretical perspective on firm growth the review takes stock of the research findings on the facilitators constraints and the trajectory of growth of mnes and elaborates on the commonalities and differences between research on the growth of mnes that draws on penrose s theory and research that does not this comparison highlights the opportunity to build an internally coherent theory of the growth of mnes that is a theory that connects what an mne is to what determines an mne s growth it also indicates that past research placed a strong emphasis on exogenous factors e g cross country distances as key constraints on growth even though the penrosean lens suggests a close consideration of endogenous factors that drive international growth as well as endogenizing the ostensibly exogenous growth determinants the review highlights the importance of firm specific managerial knowledge and learning which shapes the direction of the growth of mnes and ensures its administrative coherence

customer involvement and service firm internationalization performance an integrative framework to overcome the costs of doing business abroad researchers have suggested either legitimacy or efficiency based solutions however both types of solutions still treat host country customers as external to the theory we highlight the role of customers in the international professional business service setting and argue that customer involvement is positively related to the perceived internationalization performance of multinational corporations mncs mncs with managers who perceive higher legitimacy pressures and greater needs for local knowledge tend to undertake greater efforts to build customer involvement furthermore we develop a configuration framework between perceived strategic needs and mncs capabilities specifically mncs that match relational capability with legitimacy needs and absorptive capacity with knowledge needs are more likely to engage in customer involvement our survey of 175 chinese mncs provides evidence that customer involvement is positively related to perceived internationalization performance when mncs relational capabilities are stronger the positive relationship between legitimacy pressure and customer involvement increases by contrast mncs with greater perceived market ambiguity improve customer involvement only when they have stronger absorptive capacity we conclude that mncs may simultaneously reduce legitimacy and efficiency costs through customer involvement after considering the fit between perceived environmental pressures and firm capabilities

taking stock collective bargaining at the turn of the century examining data from two national surveys of matched pairs of union and management lead negotiators the authors evaluate the current state of practice in labor relations and test several propositions related to the transformation of american industrial relations they find that 30 40 of the parties reported that they had introduced negotiated workplace level innovations or engaged in strategic level interactions both important aspects of transformation also nearly half of the parties reported experience with use of interest based bargaining practices at the same time relatively few parties reported relationships that were improving and views on the extent of change differed between labor and management thus there is an identifiable path supporting the transformation process but only a minority of bargaining relationships are moving down that path

voter participation and strategic uncertainty the paradox of not voting is examined in a model where voters have uncertainty about the preferences and costs of other voters in game theoretic models of voter participation under complete information equilibrium outcomes can have substantial turnout even when voting costs are relatively high in contrast when uncertainty about preferences and costs is present only voters with negligible or negative net voting costs participate when the electorate is large

to know it is to love it satisfaction with democracy in the european union recent reforms have been designed to enhance the power of the european parliament to counter criticisms of a democratic deficit in the european union eu we examine how citizens now view these institutions and whether such evaluations influence their satisfaction with the way democracy works in the eu previous research has maintained that evaluations of the quality of democracy are difficult to assess because opinions about the eu largely reflect opinions about national institutions our results indicate that this is not necessarily the case particularly among those who are politically aware those with high levels of political knowledge rely more heavily on evaluations of eu institutions when assessing democracy in the eu we also find evidence that evaluations of democratic performance in the eu are motivated by the economic benefits and costs associated with membership the implications for the democratic deficit and the satisfaction with democracy measure are discussed

cost of living adjustment clauses in union contracts a summary of results our paper provides an explanation why cost of living adjustment cola provisions and their characteristics vary widely across u s industries we develop models of optimal risk sharing between a firm and union to investigate the determinants of a number of contract characteristics these include the presence and degree of wage indexing the magnitude of deferred noncontingent wage increases contract duration and the trade off between temporary layoffs and wage indexing preliminary empirical tests of some of the implications of the model are described one key finding is that the level of unemployment insurance benefits appears to influence the level of layoffs and the extent of cola coverage simultaneously

a theory of dual labor markets with application to industrial policy discrimination and keynesian unemployment this paper develops a model of dual labor markets based on employers need to motivate workers in order to elicit effort from their workers employers may find it optimal to pay more than the going wage this changes fundamentally the character of labor markets the model is applied to a wide range of labor market phenomena it provides a coherent framework for understanding the claims of industrial policy advocates it also can provide the basis for a theory of occupational segregation and discrimination that will not be eroded by market forces finally the model provides the basis for a theory of involuntary unemployment

interdependent behavior in foreign direct investment the multi level effects of prior entry and prior exit on foreign market entry this paper examines the interdependent foreign market entry decisions of multinational corporations mncs based on the argument that legitimacy and competition are two important forces in foreign market entry decisions we hypothesize that an mnc s market entry decisions are influenced by its own prior entry and prior exit decisions and those of other mncs we examine this general proposition at four levels of analysis the host country global industry an industry that spans host countries local industry an industry that is separately defined within each host country and parent firm level our analysis of a panel data of over 4000 market entry decisions that were made by japanese mncs shows that an mnc s market entry decision has a stronger inverted u shaped relationship with the prior entry and exit decisions of other mncs at the local industry level than the prior entry and exit decisions of other mncs at the host country and global industry levels we also find that both the prior entry and prior exit decisions of an mnc have a marginal influence on its own subsequent market entry decisions at the parent firm level

would rational voters acquire costly information abstract we analyze an election in which voters are uncertain about which of two alternatives is better for them voters can acquire some costly information about the alternatives in agreement with downs s rational ignorance hypothesis individual investment in political information declines to zero as the number of voters increases however if the marginal cost of information is near zero for nearly irrelevant information there is a sequence of equilibria such that the election outcome is likely to correspond to the interests of the majority for arbitrarily large numbers of voters thus rationally ignorant voters are consistent with a well informed electorate

multinational corporation internationalization in the service sector a study of japanese trading companies this paper extends chang s 1995 sequential investment theory to include multinational corporations mncs in service industries given this sector s large and growing impact on the global economy to facilitate an examination of service mnc internationalization patterns we develop a new typology of service investment i e core global related local unrelated global and unrelated local based on business relatedness and location specificity we test this typology on a sample of large japanese trading companies our results suggest that the initial investments of service mncs are closely related to their core businesses and are less location specific but that subsequent investments are less related to firms core services and are more location specific a pattern similar to the traditional view on manufacturing mncs we extend our analysis to examine several case studies to provide a richer context for these findings in addition we examine the performance implications of internationalization our findings suggest that firms that internationalize through early investments that are closely related to their core activities outperform those in unrelated businesses over time but that this performance gap between related and unrelated foreign investments diminishes in more advanced stages of internationalization

bargaining theory inflation and cyclical strike activity in manufacturing this paper presents a theoretical and empirical analysis of cyclical movements in strike activity the first part of the paper develops a bargaining model that demonstrates the crucial role of limi

do welfare benefits cause the welfare caseload analyses of the welfare system generally examine one of five competing models 1 the work disincentive model 2 the human capital model 3 the macroeconomic model 4 the public choice model or 5 the cost of job loss model this paper employs the granger causality concept and the multiple rank f statistic to test the implications of all five of these models simultaneously the results offer modest support to all but the macroeconomic model the relationships among welfare benefits caseloads and labor market conditions appear to be too complex to be fully captured by a single model

transaction cost economics and cross national patterns of industrial conflict a comparative institutional analysis at the core of a capitalist system is an implied coalition between labor and capital built upon a system of exchange and compromise without capital the material condition upon which labor s interests are realized would be impossible likewise without labor s consent to exchange wages for future investment capital could not procure the profits and savings necessary for its reproduction and transformation organizing stable and cost efficient class coalitions has long been recognized as not merely an economic priority but a political challenge yet some democracies have met this challenge more successfully than others for the student of comparative political economy an enduring question remains why the present study is an attempt to provide an answer that complements and integrates the more common macroand microanalytic studies of industrial conflict it is argued here that a useful approach is to explicate some of the major microeconomic dynamics that condition exchanges between labor and capital and to demonstrate how institutional devices designed to accommodate political representation and conflict resolution facilitate or impede the process of class compromise by employing the logic of transaction cost economics the analysis highlights the comparative institutional elements fundamental to economizing on the costs of exchange shaping consensus within a political economy s industrial relations system the resulting transaction cost efficiency model of industrial conflict specifies the ex ante cost factors price margin of transaction and the institutional control of bounded rationality and the ex post cost factors legislative polarized pluralism executive hegemony and the frequency of general elections central to the process of building and sustaining class coalitions the model is tested on data drawn from 19 democracies covering the years 1965 83 use of simulation models reveals the relative trade offs associated with different patterns of ex ante and ex post cost structures

japanese trading companies can they be copied analysis of japanese trading companies suggests that would be u s trading companies could be emulate japan s special rather than general trading companies factors likely to lead to success are offering narrow high margin product lines in geographically diversified markets integration with manufacturing operations having strong domestic markets well capitalized finances with access to ample credit perhaps achieved through partnership with large international banks efficient working capital management consisting of liberal but controlled trade credit and tight inventories management experienced in international markets and capable of heeding national interest considerations in many countries and patience and a long term outlook since during client relationships are necessary to achieve profitability

the specification of econometric strike models a varma approach in the case of macro econometric strike models classical regression techniques do not deal with important specification issues 1 the question of causality between strikes and other variables 2 the choice of appropriate lag structures and 3 omitted variable bias moreover since rational bargainers would tend to avoid previous bargaining mistakes the determinants of strike activity in a given period may not apply in subsequent periods this study attempts to model post war us strike behaviour beacuse of the spurious regression problems vector autoregressive moving average varma techniques are preferred to standard regression methods for the early post war period strikes are successfully modelled in terms of unemployment and wage and price inflation there is no feedback from strikes to the other variables contrary to the predominant view that us strikes are more frequent when real wage increases are small increasing rates of wage change both real and nominal lead to more strikes for t

on the internationalization process of firms a critical analysis even though international marketing has been challenged because of theoretical and methodological shortcomings very few researchers have actually attempted to analyze the weaknesses based on principles of theory evaluation in this article the author examines two types of models addressing the individual firm s internationalization process a theory evaluation is performed based on the explanation and the falsification criteria in order to improve the internationalization models some measures are proposed

factors affecting export intermediaries service offerings the british example this study attempts to determine and explain the service offering behavior of british export intermediaries eis it was empirically confirmed that eis offer two categories of services transaction creating and physical fulfillment services it was postulated that the extent to which an ei offers these types of services is influenced by a set of factors that are internally product market supplier and buyer related empirical tests on a sample of 135 british eis established that an ei s exporting role number of employees amount of undifferentiated products carried number of suppliers and number of countries served all have a direct impact on an ei s service offering behavior

effects of union organization on strike incidence in eu companies the author reinvestigates the relationship between the organizational power of trade unions and strikes based on data from the european company survey 2009 ecs 2009 and the institutional characteristics of trade unions wage setting state intervention and social pacts ictwss database which include more than 5 000 firms across all 27 european union eu member states he shows that the incidence of strikes is higher in companies for which workplace union membership is high the number of workplace unions is high and unions dominate establishment level works councils these factors interact to affect strike incidence in addition the company level effects of union organization on strike incidence vary across countries these country differences can partially be explained by differences in national trade union systems such as decentralization and membership density

testing dynamic models of worker effort this article derives three dynamic models of worker effort determination based on a shirking efficiency wage model a compensating differentials model and a union firm bargaining model it shows that all of these three models have the same long run comparative statics but differ in their short run dynamics we use these different predictions about the dynamics as a basis for testing the models euler equations for each model are estimated using panel data on 486 u k companies the evidence supports the shirking model in firms with low levels of unionization but the bargaining model in highly unionized industries

incomes policies inflation and strikes in nigeria 1950 1985 an empirical investigation the effects of incomes policies and inflation on the incidence of strikes in nigeria for the 1950 1985 period are examined studies have analysed extensively the determinants of strike activity in developed countries however relatively little empirical analysis of strike determinants in less developed countries exists an attempt is made to fill this gap by including key economic organizational and institutional variables into a model that is capable of predicting the variations in strikes in nigeria a developing country with a growing unionized sector the estimated results of the model show that strikes in nigeria are positively influenced by the level of inflation the level of union membership incomes policies and time trend

radical political economy and the economics of labor markets this essay is the result of a long process involving many drafts and revisions i am grateful to duncan foley for the careful and constructive criticisms offered throughout the project the following people read the manuscript at different stages and although they often disagreed with me they generously provided helpful comments two anonymous referees for this journal samuel bowles william dickens greg dow robert drago richard edwards kathleen engel richard freeman james galbraith herbert gintis jody hoffer gittel sandfordjacoby tom kochan david levine lisa lynch paul osterman michael piore bob rebitzer gil skilman dan slesnick robert thomas and tsuyoshi tsuru comments from participants in seminars at the massachusetts institute of technology university of massachusetts at amherst and hitotsubashi university are also gratefully acknowledged

service multinationals conceptualization measurement and theory the application of mne definitions measurements and theories to international services is still in its infancy despite the considerable size and growth of this sector there are problems in defining classifying measuring comparing and explaining service mnes but they do not require special definitions and theories still research to date suggests 1 delinking the concepts of multinational enterprise and foreign direct investment under certain conditions and 2 qualifying the nature of ownership internalization and location advantages in fdi theory as far as service mnes are concerned

the role of political parties an analysis based on transaction costs this paper explores the proposition that political parties reduce the transaction costs of electoral participation political parties provide a low cost signal of a candidate s policies and personal characteristics and in this way reduce voters information costs with reference to transaction cost economics political parties offer an implicit contract between voters and politicians and thereby reduce the scope for opportunism by politicians this impact on transaction costs is important in any evaluation of public policy towards political parties

longitudinal analysis of strike activity this article presents an empirical study of strike activity in a panel of contract negotiations for some 250 firm and union pairs evidence is presented on two sources of variation in dispute rates changes in the characteristics of the collective bargaining agreement that affect subsequent strike outcomes and the effects of lagged strikes on the incidence and duration of subsequent disputes strike probabilities are significantly affected by the duration and expiration month of the previous agreement dispute rates are also increased by the occurrence of a short strike during the previous negotiations and reduced by the occurrence of a long strike

the revenge of homo economicus contested exchange and the revival of political economy recent developments in microeconomic theory have shown that the self interested behavior underlying neoclassical theory is artificially truncated it depicts a charmingly victorian but utopian world in which conflicts abound but a handshake is a handshake but a handshake is not always a handshake studies of principal agent analysis the economics of information radical political economy mechanism design and transactions cost economics have all focused on the difficulties involved in policing and enforcing the actual process of market exchange abandoning the victorian world of neoclassical theory will redirect economists to an older conception of their profession what once was called political economy by taking optimizing more seriously post walrasian economics has inspired a revolution in economic thought fostering both new theoretical departures and alternative conceptions of the capitalist economy we will offer our own interpretation of this literature focusing on the widely recognized fact that the terms arising from exchange are not generally enforceable at zero cost to the exchanging parties where some aspect of the good or service supplied is both valuable to the buyer and costly to provide the absence of third party enforcement of claims gives rise to endogenous enforcement strategies we refer to this relationship as a contested exchange because unlike the transactions of walrasian economics the benefit the parties derive from the transaction depends on their own capacities to enforce competing claims

the effect of labour relations legislation on strike incidence the impact on strike incidence of nine labour relations policy variables representing legislation in eleven canadian jurisdictions is estimated using logit analysis of 3 347 individual collective agreements mandatory strike votes compulsory dues check off and compulsory conciliation boards are associated with significantly lower strike probabilities prohibition of replacement workers and employer initiated strike votes are associated with significantly higher strike probabilities no significant association was found between strike incidence and the length of cooling off period following conciliation and negotiated or automatic reopeners policy impacts are interpreted in a framework emphasizing the influence of asymmetric inforrnation and joint costs on strikes

the relationship between international diversification and performance in service firms international diversification is a growth strategy that has a major potential impact on firm performance the relationship between international diversification and firm performance has been extensively studied in the international strategy literature a major gap in the literature has been the non existence of studies that have examined the effect of international diversification on performance in service firms previous studies that have tested the international diversification performance relationship were based on samples of manufacturing firms we argue that the form of the relationship between multinationality and performance is different in service firms we provide a theoretical argument for this claim and hypothesize that there is a u shaped curvilinear relationship between multinationality and performance in service firms our sample consists of 81 major german service firms spanning across four industries results show that there is support for a u shaped curvilinear relationship based on the findings implications and directions for future research are provided

bargaining as search behavior under mutual uncertainty this paper presents a model of bargaining and strikes that differs from much of the existing literature it is based on the proposal by hicks 4 that a strike is a mistake the bargaining process is therefore conceived in this paper as a bilateral search problem in which both labor envisaged here as the union or union leadership and management seek the best possible position that is acceptable to the opposition a strike results when neither party makes an acceptable proposal before the end of the existing contract most previous models can be classified as either bargaining models that employ nash s assumption of pareto efficient outcomes or strike models that follow the ashenfelter johnson framework 8 1 in the latter framework the firm is viewed as an omniscient profitmaximizer that faces a constraint imposed by the concession schedule of the union this schedule as farber notes may not reflect economically rational choices of wage increases and strikes by workers 2 262 thus while the ashenfelter johnson model may serve as a reduced form representation of bargaining outcomes it fails to provide a price theoretic model of the structure of the bargaining process hayes attempts to reconcile the ashenfelterjohnson model with price theoretic behavior by viewing strikes as an optimal contracting process when labor lacks information possessed by the firm 3 hayes however retains the notion of profit maximization subject to a concession curve by assuming that the union presents ex ante a menu of wage strike combinations to the firm the basic structure of the bargaining process that both parties make and respond to offers is therefore ignored as in kaufman 5 this model stresses the bilateral nature of bargaining unlike kaufman emphasis is placed on the structure and object of the search process it is assumed that both parties formulate reservation positions wages above or below which continued conflict is preferred bargaining represents the attempt by each side to find or influence the reservation position of the opposition in the next section the formulation and revision of reservation positions is explored these positions need not move in a specific direction for either party unless assumptions are made regarding the values of specific variables the smoothly declining concession schedule

collective bargaining in small firms preliminary evidence of fundamental change this analysis of 481 negotiations in michigan over the period 1987 91 suggests that fundamental changes may have occurred recently in collective bargaining in small firms only 33 of the negotiations conformed to the traditional model of arm s length collective bargaining the balance involved either highly contentious or highly cooperative relations further in only one sixth 17 of the cases was the contract settled within one week before or after the contract expiration delays were more common and longer in negotiations in which settlements were implemented unilaterally by management over labor s objections than in cases involving strikes concessions figured prominently in the majority of the negotiations in the sample with a shift from wage to benefit concessions occurring during the period examined

the worker discipline effect a disaggregative analysis the authors test for the presence of a worker discipline effect wherein macroeconomic conditions influence worker effort and examine interindustry variation in its strength an employment function analysis is first used to find evidence of a worker discipline effect in the majority of u s three digit manufacturing industries a factor analysis of industry firm and labor market characteristics is then used to identify several underlying factors by which industries can be distinguished the authors find that the strength of the worker discipline effect is positively and significantly correlated with the degree to which industries have secondary characteristics copyright 1990 by mit press

the determinants of strikes in the united states 1900 1977 this study aims to assess the recent debate that has emerged in the literature over the economic and organizational political models of strikes and to propose and test a synthesis of those models as an explanation for the pattern of strike activity in the united states since 1900 the paper begins with a review of strike activity in the post 1900 period and then develops a conceptual framework incorporating six factors the size of union membership economic conditions political events institutional arrangements psychological variables and the extent of rival unionism to explain this historical pattern the second part of the paper contains a regression analysis of strike activity over the 1900 1977 period the regression results show that both the economic factors of unemployment and inflation and various noneconomic factors such as changes in union membership the outbreak of world war ii and enactment of new deal legislation are significant in explaining variations in strike activity during t

the determinants of strike incidence and severity a micro level study this paper investigates the determinants of strike incidence and severity during labor contract negotiations the author develops a model that considers the forces influencing both unions willingness to strike and employers willingness to take a strike and estimates it using data describing 1 050 negotiations in u s manufacturing during the 1971 80 period the results indicate that strike incidence is influenced by the gender composition of the labor force demand fluctuations in the product market location in a right to work state the number of workers in the bargaining unit union density in the industry and the extent to which wages kept pace with inflation over the prior contract period on the other hand neither the local unemployment rate when negotiations began nor the inflation rate over the term of the expiring contract influenced strike incidence or severity in this sample