Edited by John B. Davis and Wilfred Dolfsma
Chapter 24: Workplace democracy: current state and future directions of the literature
The literature on workplace democracy takes as its starting point the proposition that the management and governance structure of a firm greatly influences economic performance of the firm, either by unlocking or thwarting the release of knowledge and effort of firm members that could lead to everything from productivity-enhancing innovations or the increase in social capital within the enterprise to a greater sense of group and personal identity. Indeed, the potential for positive social, political and psychological effects of workplace democracy motivate rich swaths of the literature written on the topic. The present review hints at some of these dimensions, though we focus on presenting the literature on outcome variables traditionally considered and studied by economists. In the following, we first discuss the varied definitions of workplace democracy used by researchers in this field, then turn to the more recent theoretical literature on workplace democracy, followed by the empirical literature that both derives from and motivates the theoretical work. We conclude with a discussion of the limitations of the existing research and what can be done to start to fill these gaps.
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