On Thu, 5 May 2005, Doug Henwood wrote:
> I'm always skeptical of these higher wages = higher productivity
> arguments. Wal-Mart transformed retailing, and was responsible for
> sparking about a quarter of the productivity acceleration from the
> mid-1990s. (For details, see the new afterword to After the New Economy,
> coming in paperback from The New Press in a few weeks.) If they thought
> raising wages would raise productivity, they'd do it. Culturally they're a
> bunch of yahoos, but they know what they're doing with the business.
But isn't it possible that there are two competing models, both coherent?
After all, history provides examples of companies, armies and sports teams that have done well under ruthless dictatorial intimidation and others that have done well through fostering good atmosphere. Isn't it possible that you can't combine the two, but that both can actually be winning formulas? And that the proponents of both are certain theirs is the only way because it's the only way they're good at and comfortable with? You keep with what wins.
After all, high productivity and high wages used to go together in this country. So it's not an incoherent model in itself. Some people might argue that globalization tore that apart and produced Wal-Mart. But you wouldn't, I don't think, would you? Because you usually emphasize how much Walmart took the initiative and changed the scene rather than reacting to it.
Michael