The last decade has witnessed a marked increase in companies adopting new organizational practices aimed at promoting shopfloor participation (Osterman, 2000). These efforts to achieve greater employee involvement have been launched in two directions. Firstly, there has been an attempt to create a series of communication channels to permit the two-way flow of information between managers and employees. Meanwhile, there is a growing tendency to allow workers more participation and decisionmaking rights in their jobs, in a departure from the traditional organizational structure in which the worker’s tasks were strictly defined and employees were merely required to follow the supervisor’s instructions to the letter.
The growing diffusion of these practices, aimed at promoting shopfloor participation in firms, has been accompanied by keen academic interest in researching the various issues that this involves, particular attention being paid to whether or not these practices actually lead to an improvement in the firm’s performance and competitive edge (e.g. Batt and Appelbaum, 1995; Fernie and Metcalf, 1995; Black and Lynch, 1997; Ichniowski et al., 1997; Cappelli and Neumark, 1999; Ichniowski and Shaw, 1999).
The Basel Committee for Banking Supervision (BCBS), through its 1998 Capital Accord and guidance material on risk management, established a comprehensive framework for the oversight of banking activities. This framework was revised in the context of Basel II (the revised international capital framework issued in 2004 and updated in 2005; see Basel Committee, 2005). The revised accord aligns the capital measurement with sound and contemporary practices in banking and promotes further improvements in risk management. The specific documents on the management and supervision of the main banking risks, including credit market and liquidity risks, in principle are applicable to all banking systems.
Trade unions bargain for higher wages, equal pay, fair working conditions, or employment protection (Freeman and Medoff 1984). Classical models such as monopoly unions, right-to-manage models, or efficient bargaining predict a monotonic positive relationship between union power and the level of bargained wages; see the surveys of Farber (1986), Oswald (1985), and Naylor (2003). Some more recent studies emphasize effects on higher moments of the wage distribution.
In line with an insurance motive for union representation of risk-averse workers (Agell and Lommerud 1992, Burda 1995), union impact compresses the wage distribution relative to the distribution of productivities. By enforcing “equal pay for equal work” unions further seek to limit favoritism and discrimination by superiors and colleagues, and to encourage solidarity among the work force (Freeman 1982). Union-bargained wages may serve as wage floors, thereby narrowing the distribution of wages from below.
