John W. Budd

Wages and International Rent Sharing in Multinational Firms

We use a unique firm-level panel of multinational parents and their foreign affiliates to analyze whether profits are shared across borders within multinational firms. Affiliate wages are estimated to respond to both affiliate and parent profitability. The elasticity of affiliate wages to parent profits per worker is approximately 0.03, which can explain over 20 of observed variation in affiliate wages. These results reveal a previously ignored aspect of rent sharing. They also reveal an important micro-level linkage with potential macro-level implications. International rent sharing can transmit economic conditions across countries, and can thereby provide an implicit risk-sharing mechanism.

Correlates and consequences of workplace violence

A random telephone survey was used to interview 598 employees about instances, if any, when they had been physically attacked or threatened in the workplace. Demographic and workplace characteristics are analyzed as correlates of these forms of violence. The only characteristic consistently associated with higher risk is a work schedule that included nighttime hours. However, although few strong or consistent correlates of workplace violence were found, there were clear negative consequences associated with being victimized at work: lower job satisfaction, greater job stress, increased considerations of job change, and an increased likelihood of bringing mace, a gun, or another weapon to work.

Trade unions and family-friendly policies in Britain

This paper uses linked data on over 1,500 workplaces and 20,000 individuals from the 1998 British Workplace Employee Relations Survey to analyze the relationship between labor unions and the availability of six employer-provided family-friendly policies. Although unions were negatively associated with the availability of work-at-home arrangements and flexible working hours options, they appear to have increased the availability of three other policies designed to help workers balance the demands of work and family: parental leave, special paid leave, and job-sharing options. They did so both by negotiating for additional benefits (monopoly and collective voice effects) and by providing workers with information about existing policies and assisting them in using those policies (facilitation effects).

Changing Food Prices and Rural Welfare: A Nonparametric Examination of the Côte d'Ivoire

Changes in and absolute levels of agricultural pricing and food production may affect consumer food prices producer incentives income distribution and government revenue. The nature of these relationships and effects are of especial policy concern in developing countries. Nonparametric estimation techniques are applied to 1985 Living Standards household survey data of the Cote dIvoire to estimate the impact of a food price change on income distribution. This study examines how food prices are related to agricultural income across rural income in the country. In examining a different country considering a wider variety of crops estimating Engel curves and applying confidence bands the analysis extends work of A.S. Deaton. Analysis indicates that while food grown for home consumption is important net food sales and a percentage of total expenditure seem inconsequential at any level of welfare. Agricultural households grow crops to meet their consumption needs and sell the surplus only when harvests are especially bountiful. Income elasticities with respect to prices are therefore small. These findings suggest that no simple set of small price changes will significantly increase the marketed surplus of food and that structural adjustment policies may be pursued without concern for devastating poor households. Research is needed into ways of increasing food production through methods other than price changes. Results also indicate that price increases do not necessarily benefit only large well-off farms and that a wide range of issues may be considered with nonparametric estimation techniques.

New approaches to employee voice and participation in organizations

While the history of employee voice and participation is longstanding, there has been a sharp increase in interest in these topics among academics, practitioners, and policy-makers in recent years. The research on employee voice and participation has therefore significantly broadened, expanding from an earlier institutional focus to also include significant behavioural and strategic streams. This article introduces a symposium that extends our knowledge of employee voice and participation in terms of new organizational forms, practices and processes that affect the nature, structure and conditions of work and organizations by showcasing the breadth of contemporary research on voice and participation.

International Rent Sharing in Multinational Firms

We use a unique firm-level panel data set of multinational parents and their foreign affiliates to analyze whether profits are shared across borders within multinational firms. Using both fixed-effects and generalized method-of-moments estimators, affiliate wage levels are estimated to respond to both affiliate and parent profitability. The elasticity of affiliate wages to parent profits per worker is approximately 0.03, which can explain over 20 percent of the observed variation in affiliate wages. These results reveal a previously ignored aspect of labor-market rent sharing. They also reveal an important micro-level linkage with potential macro-level implications. International rent sharing can transmit economic conditions across national borders, and can thereby provide an implicit cross-country risk-sharing mechanism.

Improved Metrics for Workplace Dispute Resolution Procedures: Efficiency, Equity, and Voice

Many debates surround systems for resolving workplace disputes. In the United States, traditional unionized grievance procedures, emerging nonunion dispute resolution systems, and the court-based system for resolving employment law disputes have all been criticized. What is missing from these debates are rich metrics beyond speed and satisfaction for comparing and evaluating dispute resolution systems. In this paper, we develop efficiency, equity, and voice as these standards. Unionized, nonunion, and employment law procedures are then qualitatively evaluated against these three metrics.

Employment with a Human Face: The Author Responds

In this article, the author of Employment with a Human Face: Balancing Efficiency, Equity, and Voice responds to the four commentary essays that appeared in the June 2005 issue of this journal.

Intentional age-misreporting, age-heaping, and the 1908 Old Age Pensions Act in Ireland.

The United Kingdoms Old Age Pensions Act of 1908 instituted means-tested, non-contributory pensions for men and women aged 70 or over. The pension and the lack of civil registration of births before 1864 caused many Irish to exaggerate their ages in the Census of 1911. In this paper a linked sample from the manuscript censuses of 1901 and 1911 is used to estimate the magnitude and determinants of this age misrepresentation. Our results show three types of age discrepancies: those associated with a significant reduction in age-heaping; those associated with efforts to obtain a pension before age 70; and some apparent age-exaggeration unconnected with the Old Age Pension.

The Effect of Unions on the Receipt of Unemployment Insurance Benefits

Using National Longitudinal Survey of Youth data for 1979–91, the authors analyze the effect of union representation on the likelihood that individuals eligible for unemployment insurance (UI) benefits actually received those benefits. They find that unions had no statistically significant effect on the probability of benefit receipt among white-collar workers, but among eligible blue-collar workers, those who were laid off from union jobs were roughly 23% more likely than comparable nonunion workers to receive UI benefits. Although the analysis does not identify the reasons for this difference, two factors it appears to rule out as determinants are union-negotiated supplemental unemployment benefit plans and differences between union and nonunion workers in expected unemployment duration.