IDEAS home Printed from https://ideas.repec.org/a/kap/jbuset/v173y2021i1d10.1007_s10551-020-04535-z.html
   My bibliography  Save this article

A Nozickian Case for Compulsory Employment Injury Insurance: The Example of Sweatshops

Author

Listed:
  • Damian Bäumlisberger

    (University of Münster)

Abstract

Production in sweatshops entails an elevated risk of occupational injury and sickness due to accidents and exposure to dangerous working conditions. As most sweatshop locations lack basic social security systems, health problems have severe consequences for affected workers. Against this background, this article considers what obligations employers of sweatshop labor have to their workers, and how they should meet them. Based on core libertarian concepts, it shows that they are morally responsible for health problems caused by their management decisions, that they should compensate affected workers, and that they must prevent potentially irreversible health problems. In line with Nozick’s contractarian method, the article further argues that these obligations should be implemented through a compulsory employment injury insurance system. Such a system would impose industry-wide health and safety standards, in contrast to the view that libertarianism excludes any labor regulation for the protection of workers, as an illegitimate interference in voluntary labor contracts.

Suggested Citation

  • Damian Bäumlisberger, 2021. "A Nozickian Case for Compulsory Employment Injury Insurance: The Example of Sweatshops," Journal of Business Ethics, Springer, vol. 173(1), pages 13-27, September.
  • Handle: RePEc:kap:jbuset:v:173:y:2021:i:1:d:10.1007_s10551-020-04535-z
    DOI: 10.1007/s10551-020-04535-z
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s10551-020-04535-z
    File Function: Abstract
    Download Restriction: Access to full text is restricted to subscribers.

    File URL: https://libkey.io/10.1007/s10551-020-04535-z?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
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Gordon G. Sollars & Fred Englander, 2018. "Sweatshops: Economic Analysis and Exploitation as Unfairness," Journal of Business Ethics, Springer, vol. 149(1), pages 15-29, April.
    2. Gary S. Becker, 1974. "Crime and Punishment: An Economic Approach," NBER Chapters, in: Essays in the Economics of Crime and Punishment, pages 1-54, National Bureau of Economic Research, Inc.
    3. Alexander Brink, 2010. "Enlightened Corporate Governance: Specific Investments by Employees as Legitimation for Residual Claims," Journal of Business Ethics, Springer, vol. 93(4), pages 641-651, June.
    4. Thomas Carson, 2013. "Free Exchange for Mutual Benefit: Sweatshops and Maitland’s “Classical Liberal Standard”," Journal of Business Ethics, Springer, vol. 112(1), pages 127-135, January.
    5. Bou-Habib, Paul, 2006. "Compulsory Insurance without Paternalism," Utilitas, Cambridge University Press, vol. 18(3), pages 243-263, September.
    6. Sollars, Gordon G. & Englander, Fred, 2007. "Sweatshops: Kant and Consequences," Business Ethics Quarterly, Cambridge University Press, vol. 17(1), pages 115-133, January.
    7. Gary Gereffi & Joonkoo Lee, 2016. "Economic and Social Upgrading in Global Value Chains and Industrial Clusters: Why Governance Matters," Journal of Business Ethics, Springer, vol. 133(1), pages 25-38, January.
    8. Dionne, Georges & St-Michel, Pierre, 1991. "Workers' Compensation and Moral Hazard," The Review of Economics and Statistics, MIT Press, vol. 73(2), pages 236-244, May.
    9. Jessica Flanigan, 2018. "Sweatshop Regulation and Workers’ Choices," Journal of Business Ethics, Springer, vol. 153(1), pages 79-94, November.
    10. Kates, Michael, 2015. "The Ethics of Sweatshops and the Limits of Choice," Business Ethics Quarterly, Cambridge University Press, vol. 25(2), pages 191-212, April.
    11. Jean Tirole, 1999. "Incomplete Contracts: Where Do We Stand?," Econometrica, Econometric Society, vol. 67(4), pages 741-782, July.
    12. S. J. Liebowitz & Stephen E. Margolis, 1994. "Network Externality: An Uncommon Tragedy," Journal of Economic Perspectives, American Economic Association, vol. 8(2), pages 133-150, Spring.
    13. Katz, Michael L & Shapiro, Carl, 1985. "Network Externalities, Competition, and Compatibility," American Economic Review, American Economic Association, vol. 75(3), pages 424-440, June.
    14. Nick Lin-Hi & Igor Blumberg, 2017. "The Power(lessness) of Industry Self-regulation to Promote Responsible Labor Standards: Insights from the Chinese Toy Industry," Journal of Business Ethics, Springer, vol. 143(4), pages 789-805, July.
    15. Denis Bolduc & Bernard Fortin & France Labrecque & DPaul Lanoie, 2002. "Workers' Compensation, Moral Hazard and the Composition of Workplace Injuries," Journal of Human Resources, University of Wisconsin Press, vol. 37(3), pages 623-652.
    16. George A. Akerlof, 1970. "The Market for "Lemons": Quality Uncertainty and the Market Mechanism," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 84(3), pages 488-500.
    17. Geoffrey Brennan, 1973. "Pareto desirable redistribution: The non-altruistic dimension," Public Choice, Springer, vol. 14(1), pages 43-67, March.
    18. repec:bpj:pewipo:v:12:y:2011:i:4:p:445-459:n:6 is not listed on IDEAS
    19. Hart, Oliver D & Moore, John, 1988. "Incomplete Contracts and Renegotiation," Econometrica, Econometric Society, vol. 56(4), pages 755-785, July.
    20. Aviva Aron-Dine & Liran Einav & Amy Finkelstein & Mark Cullen, 2015. "Moral Hazard in Health Insurance: Do Dynamic Incentives Matter?," The Review of Economics and Statistics, MIT Press, vol. 97(4), pages 725-741, October.
    21. Benjamin Powell, 2018. "Sweatshop Regulation: Tradeoffs and Welfare Judgements," Journal of Business Ethics, Springer, vol. 151(1), pages 29-36, August.
    22. Williamson, Oliver, 2009. "The Theory of the Firm as Governance Structure: From Choice to Contract," Ekonomicheskaya Politika / Economic Policy, Russian Presidential Academy of National Economy and Public Administration, vol. 6, pages 111-134, December.
    23. Preiss, Joshua, 2014. "Global Labor Justice and the Limits of Economic Analysis," Business Ethics Quarterly, Cambridge University Press, vol. 24(1), pages 55-83, January.
    24. Arnold, Denis G. & Bowie, Norman E., 2003. "Sweatshops and Respect for Persons," Business Ethics Quarterly, Cambridge University Press, vol. 13(2), pages 221-242, April.
    25. Benjamin Powell & Matt Zwolinski, 2012. "The Ethical and Economic Case Against Sweatshop Labor: A Critical Assessment," Journal of Business Ethics, Springer, vol. 107(4), pages 449-472, June.
    26. Mathew Coakley & Michael Kates, 2013. "The Ethical and Economic Case for Sweatshop Regulation," Journal of Business Ethics, Springer, vol. 117(3), pages 553-558, October.
    27. Walter Block, 2008. "Labor Economics from a Free Market Perspective:Employing the Unemployable," World Scientific Books, World Scientific Publishing Co. Pte. Ltd., number 6388, August.
    28. Jan Schnellenbach, 2011. "Wohlwollendes Anschubsen: Was ist mit liberalem Paternalismus zu erreichen und was sind seine Nebenwirkungen?," Perspektiven der Wirtschaftspolitik, Verein für Socialpolitik, vol. 12(4), pages 445-459, November.
    29. Douglas Zhihua Zeng, 2010. "Building Engines for Growth and Competitiveness in China : Experience with Special Economic Zones and Industrial Clusters," World Bank Publications - Books, The World Bank Group, number 2501.
    30. Arnold, Denis G. & Bowie, Norman E., 2007. "Respect for Workers in Global Supply Chains: Advancing the Debate Over Sweatshops," Business Ethics Quarterly, Cambridge University Press, vol. 17(1), pages 135-145, January.
    31. James Buchanan, 1990. "The domain of constitutional economics," Constitutional Political Economy, Springer, vol. 1(1), pages 1-18, December.
    32. Stephanie BARRIENTOS & Gary GEREFFI & Arianna ROSSI, 2011. "Economic and social upgrading in global production networks: A new paradigm for a changing world," International Labour Review, International Labour Organization, vol. 150(3-4), pages 319-340, December.
    33. Zwolinski, Matt, 2007. "Sweatshops, Choice, and Exploitation," Business Ethics Quarterly, Cambridge University Press, vol. 17(4), pages 689-727, October.
    34. Hochman, Harold M & Rodgers, James D, 1969. "Pareto Optimal Redistribution," American Economic Review, American Economic Association, vol. 59(4), pages 542-557, Part I Se.
    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. Michael S. Aßländer, 2021. "Sweated Labor as a Social Phenomenon Lessons from the 19th Century Sweatshop Discussion," Journal of Business Ethics, Springer, vol. 170(2), pages 313-328, May.
    2. Andreas Ostermaier & Dominik Aaken, 2020. "Freedom trumps profit: a liberal approach to business ethics," Journal of Business Economics, Springer, vol. 90(5), pages 947-962, June.
    3. Gordon G. Sollars & Fred Englander, 2018. "Sweatshops: Economic Analysis and Exploitation as Unfairness," Journal of Business Ethics, Springer, vol. 149(1), pages 15-29, April.
    4. András Miklós, 2019. "Exploiting Injustice in Mutually Beneficial Market Exchange: The Case of Sweatshop Labor," Journal of Business Ethics, Springer, vol. 156(1), pages 59-69, April.
    5. Brian Berkey, 2021. "Sweatshops, Structural Injustice, and the Wrong of Exploitation: Why Multinational Corporations Have Positive Duties to the Global Poor," Journal of Business Ethics, Springer, vol. 169(1), pages 43-56, February.
    6. Gregorio Guitián & Alejo José G. Sison, 2023. "Offshore Outsourcing from a Catholic Social Teaching Perspective," Journal of Business Ethics, Springer, vol. 185(3), pages 595-609, July.
    7. Jessica Flanigan, 2018. "Sweatshop Regulation and Workers’ Choices," Journal of Business Ethics, Springer, vol. 153(1), pages 79-94, November.
    8. Rohit Varman & Per Skålén & Russell W. Belk & Himadri Roy Chaudhuri, 2021. "Normative Violence in Domestic Service: A Study of Exploitation, Status, and Grievability," Journal of Business Ethics, Springer, vol. 171(4), pages 645-665, July.
    9. Huseyin S. Kuyumcuoglu, 2021. "Sweatshops, Harm, and Interference: A Contractualist Approach," Journal of Business Ethics, Springer, vol. 169(1), pages 1-11, February.
    10. Benjamin Powell, 2018. "Sweatshop Regulation: Tradeoffs and Welfare Judgements," Journal of Business Ethics, Springer, vol. 151(1), pages 29-36, August.
    11. Rouge Jean-François, 2016. "Sweet Sweatshops - A Reflexion about the Impact of Sweatshops on Countries’ Competitiveness," Economics, Sciendo, vol. 4(1), pages 7-36, June.
    12. Schmitz, Patrick W., 2010. "Contractual solutions to hold-up problems with quality uncertainty and unobservable investments," Journal of Mathematical Economics, Elsevier, vol. 46(5), pages 807-816, September.
    13. Darcy W E Allen, 2020. "When Entrepreneurs Meet:The Collective Governance of New Ideas," World Scientific Books, World Scientific Publishing Co. Pte. Ltd., number q0269, August.
    14. Benjamin Powell & Matt Zwolinski, 2012. "The Ethical and Economic Case Against Sweatshop Labor: A Critical Assessment," Journal of Business Ethics, Springer, vol. 107(4), pages 449-472, June.
    15. J R Clark & Benjamin Powell, 2013. "Sweatshop Working Conditions and Employee Welfare: Say It Ain’t Sew," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 55(2), pages 343-357, June.
    16. Tae Wan Kim, 2018. "Gamification of Labor and the Charge of Exploitation," Journal of Business Ethics, Springer, vol. 152(1), pages 27-39, September.
    17. Travis Timmerman & Abe Zakhem, 2021. "Sweatshops and Free Action: The Stakes of the Actualism/Possibilism Debate for Business Ethics," Journal of Business Ethics, Springer, vol. 171(4), pages 683-694, July.
    18. Joshua Preiss, 2019. "Freedom, Autonomy, and Harm in Global Supply Chains," Journal of Business Ethics, Springer, vol. 160(4), pages 881-891, December.
    19. Barney Hartman‐Glaser & Benjamin Hébert, 2020. "The Insurance Is the Lemon: Failing to Index Contracts," Journal of Finance, American Finance Association, vol. 75(1), pages 463-506, February.
    20. J. Guasch & Jean-Jacques Laffont & Stéphane Straub, 2006. "Renegotiation of Concession Contracts: A Theoretical Approach," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 29(1), pages 55-73, September.

    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:kap:jbuset:v:173:y:2021:i:1:d:10.1007_s10551-020-04535-z. 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: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    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.