IDEAS home Printed from https://ideas.repec.org/a/bla/indrel/v54y2023i1p71-94.html
   My bibliography  Save this article

What do indebted employees do? Financialisation and the decline of industrial action

Author

Listed:
  • Giorgos Gouzoulis

Abstract

While isolated episodes of work stoppages keep occurring, aggregate industrial action rates have been on the decline over the last five decades. Attempts to explain this trend centre on the short‐term effects of the business cycle and the long‐term impacts of labour market liberalisation, deindustrialisation and globalisation. This paper argues that household indebtedness is a missing piece of the puzzle. Since indebted employees tend to become self‐disciplined at the workplace on the fear of losing their job and defaulting, this paper argues that the post‐1970 rise of household financialisation is associated with the decline of strike activity. The econometric evidence reported provides strong support to this argument for the cases of Japan, Korea, Sweden, the United States and the United Kingdom over the period 1970–2018.

Suggested Citation

  • Giorgos Gouzoulis, 2023. "What do indebted employees do? Financialisation and the decline of industrial action," Industrial Relations Journal, Wiley Blackwell, vol. 54(1), pages 71-94, January.
    • Handle: RePEc:bla:indrel:v:54:y:2023:i:1:p:71-94
    DOI: 10.1111/irj.12391
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/irj.12391
    Download Restriction: no
    File URL: https://libkey.io/10.1111/irj.12391?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Jonas Pontusson, 2013. "Unionization, Inequality and Redistribution," British Journal of Industrial Relations, London School of Economics, vol. 51(4), pages 797-825, December.
    2. Òscar Jordà & Moritz Schularick & Alan M. Taylor, 2017. "Macrofinancial History and the New Business Cycle Facts," NBER Macroeconomics Annual, University of Chicago Press, vol. 31(1), pages 213-263.
    3. Mark Stelzner, 2017. "The new American way—how changes in labour law are increasing inequality," Industrial Relations Journal, Wiley Blackwell, vol. 48(3), pages 231-255, May.
    4. Laszlo Goerke & Jakob B. Madsen, 2004. "Labour Disputes in the Twentieth Century: an International Comparison and Evaluation of Theories," Homo Oeconomicus, Institute of SocioEconomics, vol. 20, pages 391-422.
    5. Card, David, 1990. "Strikes and Bargaining: A Survey of the Recent Empirical Literature," American Economic Review, American Economic Association, vol. 80(2), pages 410-415, May.
    6. Timothy Blackwell & Sebastian Kohl, 2018. "The origins of national housing finance systems: a comparative investigation into historical variations in mortgage finance regimes," Review of International Political Economy, Taylor & Francis Journals, vol. 25(1), pages 49-74, January.
    7. Giorgos Gouzoulis & Panagiotis (Takis) Iliopoulos & Giorgos Galanis, 2023. "Financialization and the rise of atypical work," British Journal of Industrial Relations, London School of Economics, vol. 61(1), pages 24-45, March.
    8. Ashenfelter, Orley & Johnson, George E, 1969. "Bargaining Theory, Trade Unions, and Industrial Strike Activity," American Economic Review, American Economic Association, vol. 59(1), pages 35-49, March.
    9. Froud, Julie, et al, 2000. "Restructuring for Shareholder Value and Its Implications for Labour," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 24(6), pages 771-797, November.
    10. Giorgos Gouzoulis, 2022. "Financialisation, globalisation, and the industrial labour share: A comparison between Iran and Thailand," Industrial Relations Journal, Wiley Blackwell, vol. 53(1), pages 35-52, January.
    11. Hoyt N. Wheeler, 1984. "Determinants of Strikes," ILR Review, Cornell University, ILR School, vol. 37(2), pages 263-269, January.
    12. Thibault Darcillon, 2016. "Labor-Market Volatility and Financial Development in the Advanced OECD Countries: Does Labor-Market Regulation Matter?," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 58(2), pages 254-278, June.
    13. Thibault Darcillon, 2016. "Labor-market volatility and financial development in the advanced OECD countries: Does labor market regulation matter?," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-01248986, HAL.
    14. Giorgos Gouzoulis, 2021. "Finance, Discipline and the Labour Share in the Long‐Run: France (1911–2010) and Sweden (1891–2000)," British Journal of Industrial Relations, London School of Economics, vol. 59(2), pages 568-594, June.
    15. John W. Budd, 1994. "The Effect of Multinational Institutions on Strike Activity in Canada," ILR Review, Cornell University, ILR School, vol. 47(3), pages 401-416, April.
    16. Gourevitch, Alex, 2018. "The Right to Strike: A Radical View," American Political Science Review, Cambridge University Press, vol. 112(4), pages 905-917, November.
    17. Peter Turnbull, 2000. "Contesting Globalization on the Waterfront," Politics & Society, , vol. 28(3), pages 367-391, September.
    18. Sweet, Elizabeth, 2018. "“Like you failed at life”: Debt, health and neoliberal subjectivity," Social Science & Medicine, Elsevier, vol. 212(C), pages 86-93.
    19. Davidson, James E H, et al, 1978. "Econometric Modelling of the Aggregate Time-Series Relationship between Consumers' Expenditure and Income in the United Kingdom," Economic Journal, Royal Economic Society, vol. 88(352), pages 661-692, December.
    20. John Peters, 2012. "Neoliberal convergence in North America and Western Europe: Fiscal austerity, privatization, and public sector reform," Review of International Political Economy, Taylor & Francis Journals, vol. 19(2), pages 208-235.
    21. Tracy, Joseph S, 1986. "An Investigation into the Determinants of U.S. Strike Activity," American Economic Review, American Economic Association, vol. 76(3), pages 423-436, June.
    22. Erik Bengtsson, 2014. "Do unions redistribute income from capital to labour? Union density and wage shares since 1960," Industrial Relations Journal, Wiley Blackwell, vol. 45(5), pages 389-408, September.
    23. Bruce E. Kaufman, 1982. "The Determinants of Strikes in the United States, 1900–1977," ILR Review, Cornell University, ILR School, vol. 35(4), pages 473-490, July.
    24. Peter Boxall & Peter Haynes, 1997. "Strategy and Trade Union Effectiveness in a Neo-liberal Environment," British Journal of Industrial Relations, London School of Economics, vol. 35(4), pages 567-591, December.
    25. Sheena McConnell, 1990. "Cyclical Fluctuations in Strike Activity," ILR Review, Cornell University, ILR School, vol. 44(1), pages 130-143, October.
    26. John Godard, 2011. "What Has Happened to Strikes?," British Journal of Industrial Relations, London School of Economics, vol. 49(2), pages 282-305, June.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Giorgos Gouzoulis, 2021. "Finance, Discipline and the Labour Share in the Long‐Run: France (1911–2010) and Sweden (1891–2000)," British Journal of Industrial Relations, London School of Economics, vol. 59(2), pages 568-594, June.
    2. Giorgos Gouzoulis & Panagiotis (Takis) Iliopoulos & Giorgos Galanis, 2023. "Financialisation, Underemployment, & the Disconnected Greek Capitalism," Working Papers 112, Queen Mary, University of London, School of Business and Management, Centre for Globalisation Research.
    3. Giorgos Gouzoulis & Panagiotis (Takis) Iliopoulos & Giorgos Galanis, 2022. "EU-induced Financialisation and Its Impact on the Greek Wage Share, 1999-2021," Working Papers 109, Queen Mary, University of London, School of Business and Management, Centre for Globalisation Research.
    4. Giorgos Gouzoulis & Panagiotis (Takis) Iliopoulos & Giorgos Galanis, 2023. "Financialization and the rise of atypical work," British Journal of Industrial Relations, London School of Economics, vol. 61(1), pages 24-45, March.
    5. S Milner, 1995. "Industrial Disputes and the Law in Spain," CEP Discussion Papers dp0250, Centre for Economic Performance, LSE.
    6. Gouzoulis, Giorgos & Constantine, Collin, 2020. "The Political Economy of Inequality in Chile and Mexico: Two Tales of Neoliberalism," SocArXiv gruzp, Center for Open Science.
    7. William H. Greene & Ana P. Martins, 2002. "Striking Features of the Labor Market," EERI Research Paper Series EERI RP 2002/08, Economics and Econometrics Research Institute (EERI), Brussels.
    8. William H. Greene & Ana P. Martins, 2013. "Striking Features of the Labor Market: Theory," Journal of Economics and Econometrics, Economics and Econometrics Society, vol. 56(2), pages 1-24.
    9. Giorgos Gouzoulis & Collin Constantine, 2020. "The Political Economy of Inequality in Chile and Mexico: Two Tales of Neoliberalism," Working Papers 235, Department of Economics, SOAS University of London, UK.
    10. Symeonidis, George, 2017. "Does product market competition increase strike activity? Evidence from the UK," European Economic Review, Elsevier, vol. 97(C), pages 42-56.
    11. Milner, S., 1995. "Industrial disputes and the law in Spain," LSE Research Online Documents on Economics 20710, London School of Economics and Political Science, LSE Library.
    12. William H. Greene & Ana P. Martins, 2013. "Striking Features of the Labor Market: Empirical Evidence," Journal of Economics and Econometrics, Economics and Econometrics Society, vol. 56(2), pages 25-53.
    13. Kyung nok Chun & Zachary Schaller & Stergios Skaperdas, 2020. "Why Are There Strikes?," Revue d'économie politique, Dalloz, vol. 130(6), pages 929-956.
    14. Archontis L. Pantsios & Solomon W. Polachek, 2017. "How Asymmetrically Increasing Joint Strike Costs Need Not Lead to Fewer Strikes," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 45(2), pages 149-161, June.
    15. Perry, L. J. & Wilson, Patrick J., 2004. "Trends in work stoppages : a global perspective," ILO Working Papers 993742343402676, International Labour Organization.
    16. Stefan Oliver Houpt & Juan Carlos Rojo Cagigal, 2014. "Relative deprivation and labour conflict during Spain’s industrialization: the Bilbao estuary, 1914–1936," Cliometrica, Journal of Historical Economics and Econometric History, Association Française de Cliométrie (AFC), vol. 8(3), pages 335-369, September.
    17. Anthony Y. Baah & Barry Reilly, 2009. "An Empirical Analysis of Strike Durations in Ghana from 1980 to 2004," LABOUR, CEIS, vol. 23(3), pages 459-479, September.
    18. Miguel Malo & Nuria Sánchez-Sánchez, 2014. "The legal form of labour conflicts and their time persistence: an empirical analysis with a large firms’ panel," European Journal of Law and Economics, Springer, vol. 38(3), pages 513-533, December.
    19. Peter Cramton & Joseph Tracy, 2003. "Unions, Bargaining and Strikes," Papers of Peter Cramton 02ubs, University of Maryland, Department of Economics - Peter Cramton, revised 05 Sep 2002.
    20. Harrison, Alan & Stewart, Mark, 1994. "Is Strike Behavior Cyclical?," Journal of Labor Economics, University of Chicago Press, vol. 12(4), pages 524-553, October.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:indrel:v:54:y:2023:i:1:p:71-94. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=0019-8692 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.