Bruno Tinel

Inter-firm dependency and employment inequalities: Theoretical hypotheses and empirical tests on French subcontracting relationships

This article highlights the importance of power relations in subcontracting relationships and analyzes their impact on firms’ employment management practices. We show that the use of subcontracting creates a chain of inter-firm economic dependency because it leads the principal contractor to plan and control the activities of the subcontractors. The hypothesis is that this chain of dependency influences both the skill structure and wage levels. Empirical tests carried out on French data confirm that firms that subcontract outsource execution tasks and that the hierarchy of firms impacts employees’ wage levels.

Why and How Do Capitalists Divide Labour? From Marglin and Back again through Babbage and Marx

Nearly four decades ago, Stephen Marglin explored the origins of hierarchy in capitalist production with a divide and conquer hypothesis based on the idea that the monopolisation of knowledge about production technology plays a major role in explaining how workers are deprived of control over the labour process. Nevertheless, this explanation has some shortcomings that Marx and Babbage had avoided. Those two authors provided a highly accurate and convincing interpretation of the division of labour that remains relevant. The present paper proposes a general synthesis of their analysis. Two points are emphasised: (1) the division of labour plays a major role in wage determination; and (2) the division of labour largely determines the form of subjection of labour to capital.

The Political Economy of Work

How has the notion of work quality been treated in the economic literature since the mercantilists? David Spencer reminds us that the quality of work has been an absent issue for three centuries, at least for most of the consecutive dominant approaches in our discipline. When the issue was considered, it often appeared as the mere projection of the social prejudices of the dominant classes. Spencer’s book is much more than a history of how economists have thought about work quality, although that would be a worthy project in itself. The book is designed to shed light on the latest economic research relating to labour, including efficiency wage theory, personnel economics and, in the final chapter, the ‘economics of happiness’. Spencer uses the history of ideas not only to examine critically how mainstream economists have been led to analyse work as they do today, but also to provide the basis for an alternative analysis built upon a longstanding intellectual tradition in the social sciences. The aim of the book is indeed both critical of the mainstream and constructive of a heterodox view. For a decade, Bruno Frey, Carol Graham, Richard Layard and others studying the economics of happiness, have claimed, in opposition to a tenet of mainstream economic theory, that utility ought to be treated as scientifically measurable. Thanks to new techniques developed within psychology, such as the use of surveys of reported well-being, factors other than income can now be taken into account to analyse individual well-being. For example, subjective measures of job satisfaction can be used to measure the utility that workers experience from work itself. As noted by Spencer (p. 128), ‘in the case of the economics of happiness, there is now increasing recognition that interpersonal comparisons of preferences are possible and indeed necessary in the evaluation of individual well-being.’ But the economics-of-happiness approach to job quality, he contends, does not fundamentally challenge the basis of mainstream economics. The weaknesses of the other mainstream theories of work apply also to the new economics of happiness. Spencer does a good job of cataloguing those weaknesses. Contrary to what the compensating wage differentials literature pretends, there is little evidence that workers can substitute higher income for less enjoyable work; on the contrary, lower wages are generally associated with unpleasant work. In principalagent theories, such as transaction costs economics, efficiency wage models and Review of Political Economy, Volume 22, Number 4, 617–622, October 2010