Douglas L. Kruse

Employee Stock Ownership and Corporate Performance among Public Companies

This study compares the corporate performance in 1990/91 of two groups of public companies: those in which employees owned more than 5% of the companys stock, and all others. The results of the analysis, which looks at profitability, productivity, and compensation, are consistent with neither negative nor highly positive views of employee ownership, but where differences are found, they are favorable to companies with employee ownership, especially among companies of small size. The circumstances in which employee ownership was used—specifically, whether it was part of a wage/benefit concession package and whether it was involved in a takeover threat—do not appear to have had a significant effect on the 1990 performance levels or 1980–90 performance growth of the firms. Although the authors caution that the data do not permit clear tests of causality, these results are broadly consistent with those of past studies.

Employment of People with Disabilities Following the ADA

Studies finding a negative effect of the Americans with Disabilities Act (ADA) on the employment of people with disabilities have used the work disability measure, which has several potential problems in measuring employment trends. Using Survey of Income and Program Participation (SIPP) data that permit alternative measures of disability, this study finds decreased employment among those reporting work disabilities in the first few years after the ADA was passed but increased employment when using a more probably appropriate measure of ADA coverage (functional and activity limitations that do not prevent work). State-by-state variation in labor market tightness is used to find that people with disabilities may have especially procyclical employment, but the contrary results in overall employment trends remain after accounting for labor market tightness. Given the problems in measuring who is covered by the ADA, there is reason to be cautious of both positive and negative findings.

Profit Sharing and Productivity: Microeconomic Evidence from the United States

Profit sharing has often been suggested as a potential solution to principal/agent problems in the workplace. The relationship between productivity and profit sharing is examined using a panel dataset drawn from 2,976 publicly-held companies over the 1971-85 period. Alternatively using firm-intercept and first-difference specifications, the regression results indicate that the adoption of profit sharing is associated with a 2.5-4.2 percent increase in productivity. In addition, the size of the effect increases with the proportion of employees participating in profit sharing. These results hold under a variety of specifications and do not appear to be explained by accompanying changes in management or personnel policies. Copyright 1992 by Royal Economic Society.

Is Disability Disabling in All Workplaces? Workplace Disparities and Corporate Culture

Using nearly 30,000 employee surveys from fourteen companies, we find disability is linked to lower average pay, job security, training, and participation in decisions, and to more negative attitudes toward the job and company. Disability gaps in attitudes vary substantially, however, across companies and worksites, with no attitude gaps in worksites rated highly by all employees for fairness and responsiveness. The results indicate that corporate cultures that are responsive to the needs of all employees are especially beneficial for employees with disabilities.

International trade and the labor market experience of displaced workers

Using data from the Displaced Workers Survey and the National Bureau of Economic Research Trade and Immigration Dataset, the author of this study finds that among manufacturing workers displaced in 1979–83, the average duration of joblessness varied directly with the rise in their industrys import share since 1972–74. This relationship appears to be due in large part to the fact that the work force in industries with rising import shares tends to have demographic characteristics associated with labor market adjustment difficulties, such as higher proportions of women and blue-collar workers than are found in other industries.

Enabling Democracy: Disability and Voter Turnout

How likely are the millions of Americans with disabilities to participate in politics? What insights do their experiences provide into overall participation levels and determinants? This article reports the results of a nationally representative household telephone survey of 1,240 peoplestratified to include 700 people with disabilities-following the November 1998 elections. Voter turnout is found to be 20 percentage points lower among people with disabilities than among people without disabilities who have otherwise-similar demographic characteristics. Other standard predictors of turnout such as political efficacy and mobilization explain only a small portion of this gap. There is great variation within the disability sample: the lower turnout is concentrated among people with disabilities who are not employed or who are age 65 or older, who have had recent onset of a disabling condition, and who have difficulty going outside alone (despite the availability of absentee ballots). The findings suggest that disability, apart from imposing resource constraints, often has social and psychological effects that decrease voter turnout through decreased social capital and identification with mainstream society, particularly among senior citizens. The findings also support the idea that general mobility and major life transitions can be important influences on voter turnout in general, and raise questions on the causal relations among age, employment, efficacy, and voter turnout that should be a focus of future research.

U.S. High-Performance Work Practices at Century's End

This study examines the incidence, industry differences, and economic environment of work practices in the United States in 1994 and 1997 using census data from a nationally representative random sample of establishments. Self-managed work teams were used by a majority of workers in some sites. Work-related meetings had higher incidence. A high-performance work organization is used in about 1 percent of establishments. There were significant industry differences associated with globalization, namely, imports and exports.

Motivating Employee-Owners in Esop Firms: Human Resource Policies and Company Performance

What enables some employee ownership firms to overcome the free rider problem and motivate employees to improve performance? This study analyzes the role of human resource policies in the performance of employee ownership companies, using employee survey data from 14 companies and a national sample of employee-owners. Between-firm comparisons of 11 ESOP firms show that an index of human resource policies, nominally controlled by management, is positively related to employee reports of co-worker performance and other good workplace outcomes (including perceptions of fairness, good supervision, and worker input and influence). Within-firm comparisons in three ESOP firms, and exploratory results from a national survey, show that employee-owners who participate in employee involvement committees are more likely to exert peer pressure on shirking co-workers. We conclude that an understanding of how and when employee ownership works successfully requires a three-pronged analysis of: 1) the incentives that ownership gives; 2) the participative mechanisms available to workers to act on those incentives; and 3) the corporate culture that battles against tendencies to free ride.

Sharing Ownership via Employee Stock Ownership

There is considerable focus at the moment on equity ownership. According to an article in The Economist, 1 in 2001 over 50 per cent of the adult population in the United States owned equity. This was a 100 per cent increase since the time of the market correction in 1987. Equity ownership is not only a growing phenomenon in the United States but is also occurring worldwide. More than 50 per cent of Australians and 20 per cent of Germans own shares, and equity ownership is growing in virtually every major Western country.2 Equity ownership, in the form of stocks or property, plant and equipment, has always been an important element of the wealth of upper-income people in Western societies. However the recent rise of equity ownership has occurred in the context of four major developments. First, equity markets have grown as a way of raising funds and have prospered as a result of general business expansion, the rise of world capital markets and the wide diffusion of information technology in financial markets.

Profit-Sharing and Employment Variability: Microeconomic Evidence on the Weitzman Theory

This study tests an important implication of Weitzmans profit-sharing theory—the prediction that profit-sharing firms will have more stable employment than fixed-wage firms—using panel data on 2,976 publicly traded companies for the years 1971–85. Profit-sharing manufacturing firms are found to have had smaller employment decreases than other manufacturing firms during business downturns: when the unemployment rate increased by one point, manufacturing firms in which all employees participated in a profit-sharing pension plan had a 2.0% decrease in employment, compared to a 3.1% decrease for nonprofit-sharing manufacturing firms. No significant differences in employment stability were found, however, between profit-sharing and non-profit-sharing firms in the non-manufacturing sector.