Edited by Keith Townsend and Adrian Wilkinson
Chapter 16: Industrial Relations in China: Ball of Confusion?
* E. Patrick McDermott INTRODUCTION Dunlop, Slichter, Commons and other IR theorists have been referred to as focusing on the ‘old labor economics’ identifying unions as having the economic goals of wealth redistribution, aggrandizement and protection; and the political function of constitutional government in industry (Kaufman, 2005). Dunlop rejected the classical economist argument that unions disrupt the wage market because he believed that no such perfect market exists (Kaufman, 2002). He identified a system that includes external forces influencing three key actors: labor, management and the government. The key to Dunlop’s IR model, and what distinguishes it from economics, is that labor is not quantified as a commodity; rather the employment relationship is characterized as a complex social and economic interaction. In 1935 Slichter observed that trade unions introduce civil rights into the workplace and fix wages (Slichter, 1985). He saw trade unions as a positive force because collective bargaining contributes to the development of professional management by requiring planning efficiency and related skills demanded in a bargaining relationship (Slichter et al., 1960). IR theory must be reconciled with the decline of organized labor across developed nations. Some reasons posited for the decline include government and employer hostility to unions, lack of interest by current generations and knowledge workers, outsourcing, the rise of free trade agreements, and the rise of human resource management as a substitution for employee representation. This sea change in environmental forces necessitates a reconsideration of traditional IR theory. Thus, Lord Wedderburn (2007, pp. 397, 398) identifies the...
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