International Perspectives on Participation (Advances in the Economic Analysis of Participatory and Labor-Managed Firms)

This volume analyzes employee participation in under-researched countries and whose economic institutions differ from the Anglo-American context. Part one of the volume is dedicated to China. In a context in which economic decisions made by companies are closely influenced by the political institutions and practices, the extent to which Chief Executive Officers (CEOs) have the ability to make autonomous decisions is not to be taken for granted. The volume explores whether the executive labor market and firms' executive compensation practices differ from the Western context. Evidence on the role of trade unions in Chinese companies is also analyzed. Part two of the volume includes empirical evidence from Europe, Japan, and Korea, and focuses on high-involvement work practices. The main questions that the volume addresses are the incidence and determinants of these practices and their effects on firm performance. Evidence on the incidence contributes to understanding the importance of these practices in an international context, and the analyses on the determinants and effects help understand how the main trade-offs play out in different institutional contexts. Front Cover 1 International Perspectives on Participation 4 Copyright page 5 Contents 6 List of Contributors 8 Foreword 10 International Perspectives on Participation: Decision Rights and Incentives 12 Chapter 1 How Much Influence Does the Chinese State Have Over CEOs and Their Compensation? 18 Introduction 19 The Role of the State in China’s Corporations and Its Implications for CEOs 20 State Involvement in Corporations and CEO Autonomy 23 Is CEO Compensation Linked to Firm Performance and if so, How? 25 The State’s Influence on CEO Compensation 27 Conclusion 34 Notes 35 Acknowledgements 36 References 36 Data Appendix 37 Chapter 2 CEO Incentive Contracts in China: Why Does City Location Matter? 42 Introduction 43 The Adoption of CEO Incentive Contracts and the Role of City Experimentation 45 Data and Estimation 48 Results 51 Discussion and Conclusion 55 Notes 57 Acknowledgements 58 References 58 Data Appendix 60 Chapter 3 Retrieving the Missing Transmission Belt in Community-Based Small Workplaces? The “Professional Union Leader and Organizer Program" in China 68 Introduction 69 The Chinese Union and its Power Sources 70 The PULOP: Context and Overview 72 The PULOP: Case Evidence from Two Regional Trials 75 Mapping Out the Cases 75 Recruiting and Selecting the PULs 76 Funding and Managing the PULs 76 The Organizing Campaigns and Elections 77 Collective Contracts 78 Union Finances 79 Workplace Revisit and Labor Dispute Resolution 81 Members’ Attitudes towards the PULs and the SBUAs 82 Discussion 83 Concluding Remarks 85 Notes 86 References 88 Chapter 4 Cooperative and Islamic Banks: What Can They Learn from Each Other? 90 Introduction 91 Characteristics 91 Cooperative Banks and Credit Unions 91 Main Features 91 Development and Organization 92 Islamic Banks 94 Main Features 94 Development and Organization 98 Similarities and Differences 99 What Can Each Learn from the Other? 103 Cooperative Elements in Islamic Financial Institutions 103 Broader Risk Sharing in Cooperative Banking 104 Conclusion 106 Notes 107 Acknowledgments 109 References 110 Chapter 5 High-Involvement Work Systems in Japan, the United States, and Korea: Evidence from Field Research 112 Introduction 113 HIWS and Its Three Pillars 114 1st Pillar “Opportunities” 114 2nd Pillar “Incentives” 115 3rd Pillar “Ability” 116 Japanese Firms as Early Experimenters with HIWS 116 Opportunities at the Grassroots 116 Opportunities at the Top 119 Brief Discussions on Incentive and Ability 122 U.S. Firms Responding to the “Japanese Manufacturing Challenge” 123 Opportunities at the Grassroots 123 Opportunities at the Top 125 Brief Discussions on Incentives and Ability 126 Korean Firms: A Hybrid Model? 127 Opportunities at the Grassroots 127 Mandatory Opportunities at the Top 129 Brief Discussions on Incentive and Ability 129 Conclusions 131 Notes 132 Acknowledgments 133 References 133 Chapter 6 The Effects of Innovative Work Practices on Firm and Worker Outcomes: Evidence from Lithuania 138 Introduction 139 Conceptual Framework 140 Overview of the Firms and Discussion of Descriptive Statistics 143 Empirical Strategy and Findings 152 Summary and Conclusions 160 Notes 162 Acknowledgments 164 References 164 Appendix: Variable Descriptions 167 Chapter 7 Autonomy and Pay-for-Performance in Spanish Industrial Plants 168 Introduction 169 Theoretical Background 170 Main Hypotheses 170 Other Relationships 175 Methods 177 Data Description 177 Econometric Approach 180 Results 184 Implications 187 Conclusions 190 Notes 191 Acknowledgments 192 References 192 Appendix: Definition of Variables from the Questionnaire 196 Chapter 8 Job-Related Training and Education Sponsorship: An Analysis Based on Market Concentration 202 Introduction 203 Literature Review 205 The Model: Training and Commitment Decisions 206 Pure Strategies: A Single Worker in Each Cohort 209 Mixed Strategies: A Pool of Workers in Each Cohort 214 Discussion 221 Evidence 223 Spain 224 United Kingdom 228 Summary and Conclusions 230 Notes 231 Acknowledgements 232 References 232 Appendix A 234 Proof of Propositions 1–7 234 Proof of Propositions 8–10 236 Appendix B: Description of the Data 238 ECHP (Spain) Dataset Variables 238 BHPS (United Kingdom) Dataset Variables 239 This volume analyses employee participation in under- researched countries and whose economic institutions differ from the Anglo-American context. Part one of the volume is dedicated to China. In a context in which economic decisions made by companies are closely influenced by the political institutions and practices, the extent to which Chief Executive Officers (CEOs) have the ability to make autonomous decisions is not to be taken for granted. The volume explores whether the executive labor market and firms'executive compensation practices differ from the Western context. Evidence on the role of trade unions in Chinese companies is also analyzed. Part two of the volume includes empirical evidence from Europe, Japan, and Korea, and focuses on high-involvement work practices. The main questions that the volume addresses are the incidence and determinants of these practices and their effects on firm performance. Evidence on the incidence contributes to understanding the importance of these practices in an international context, and the analyses on the determinants and effects help understand how the main trade-offs play out in different institutional contexts. This volume analyses employee participation in under-researched countries and whose economic institutions differ from the Anglo-American context. The first three papers are dedicated to China. In a context in which economic decisions made by companies are closely influenced by the political institutions and practices, the extent to which Chief Executive Officers (CEOs) have the ability to make autonomous decisions is not to be taken for granted. The volume explores whether the executive labor market and firms' executive compensation practices differ from the Western context. Evidence on the role of trade unions in Chinese companies is also analyzed. The rest of the volume includes empirical evidence from Europe, Japan, and Korea, and focuses on high-involvement work practices. The main questions that the volume addresses are the incidence and determinants of these practices and their effects on firm performance. Evidence on the incidence contributes to understanding the importance of these practices in an international context, and the analyses on the determinants and effects help understand how the main trade-offs play out in different institutional contexts Volume 15 of the successful series Advances in the Economic Analysis of Participatory and Labor-Managed Firms, AEAP provides a leading forum for high-quality original theoretical and empirical research in the broad area of participatory and labor managed organizations.