Worker Cooperation and the Ratchet Effect

Lorne Hugh Carmichael () and W. Bentley Macleod

Journal of Labor Economics, 2000, vol. 18, issue 1, pages 1-19

Abstract: Workers paid by the piece should be happy to introduce new techniques that increase output, but firms always seem to reduce the piece rate when workers start earning too much money. Workers respond by restricting output and keeping good new ideas to themselves. We show that this outcome is inevitable in a competitive environment. However, there are noncompetitive situations where firms can use piece rates to get cooperation from their workers. These predictions are consistent with case history evidence from the cotton spinning industry in England in the nineteenth century and the Lincoln Electric Company in the United States even today. Copyright 2000 by University of Chicago Press.

Date: 2000
View citations in EconPapers

Downloads: (external link)
http://links.jstor.org/sici?sici=0734-306X%2820000 ... O%3B2-E&origin=repec full text (application/pdf)
Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:ucp:jlabec:v:18:y:2000:i:1:p:1-19

Ordering information: This journal article can be ordered from
http://www.journals.uchicago.edu/JOLE/order1.html

Access Statistics for this article

Journal of Labor Economics is edited by Derek A. Neal

More articles in Journal of Labor Economics from University of Chicago Press
Address: The University of Chicago Press, Journals Division, P.O. Box 37005 Chicago, IL 60637
Series data maintained by Christopher F. Baum ().