Governing the Firm: Workers' Control in Theory and Practice - Softcover

Dow, Gregory K.

Softcover

ISBN 10: 0521522218 ISBN 13: 9780521522212

Publisher: Cambridge University Press, 2003

Synopsis

Most large firms are controlled by shareholders, who choose the board of directors and can replace the firms management. In rare instances, however, control over the firm rests with the workforce. Many explanations for the rarity of workers' control have been offered, but there have been few attempts to assess these hypotheses in a systematic way. This book draws upon economic theory, statistical evidence, and case studies to frame an explanation. The fundamental idea is that labor is inalienable, while capital can be freely transferred from one person to another. This implies that worker controlled firms typically face financing problems, encounter collective choice dilemmas, and have difficulty creating markets for control positions within the firm. Together these factors can account for much of what is known about the incidence, behavior, and design of worker- controlled firms. A policy proposal to encourage employee buyouts is developed in the concluding chapter. Gregory L. Dow is Professor and Chair of the Department of Economics at Simon Fraser University, British Columbia, Canada. He previously taught at the University of Alberta and Yale University, and has served as a visiting professor at the University of New South Wales, the Erasmus Institute for Philosophy and Economics, and the Swedish Collegium for Advanced Studies in the Social Sciences. Professor Dow is Associate Editor on the Journal of Economic Behavior and Organization and has published numerous articles on labor-managed firms and other topics in economic theory in leading journals such as the American Economic Review and the Journal of Political Economy.

About this title

Book Description

Most large firms are controlled by shareholders, who choose the board of directors and acan replace the firm's top management. In a few firms, however, control rests instead with the workforce. Economists have had little success in explaining the rarity of worker-controlled firms. This book provides case studies of such firms and surveys the available evidence on their design and behavior. It also exploits ideas from recent economic theory to explain the rarity of these firms, and outlines a policy proposal to encourage employee buyouts of conventional firms.

Review

"In market economics, most firms are owned and managed by those who supply finacial capital, not by the people who work in them. Why? This is a topic that sometimes generates more heat than light. However, in this dispassionate analysis, Greg Dow perceptively examines the rich and diverse literature on this topic and comes up with important insights. This book will immediately become the standard reference on worker ownership and management and is thoroughly recommended for both specialists and non-specialists alike." John Pencavel, Stanford University

"It's been a long time since the appearance of so important a book on worker participation and the governance of enterprises. Dow lays out the states of our knowledge and of our ignorance clearly and readably, inviting us to join him in thinking about what might be the next steps forward. No better introduction to the subject matter is available." Louis Putterman, Brown University

"What difference does it make when workers rather than capital owners control firms, electing managers, and owning (for better or worse) the fruits of their labor? Greg Dow's Governing the Firm provides the economic analysis and empirical facts based on the experience production cooperatives around the world to answer this question. It's the best book on the subject." Samuel Bowles, University of Massachusetts, Amherst

Edition details

• Publisher: Cambridge University Press
• Publication date: 2003
• ISBN 10: 0521522218
• ISBN 13: 9780521522212
• Binding: Paperback
• Language: English
• Number of pages: 342