You open your argument with saying, in essence, that people hate their jobs and are miserable at their jobs.
You then argue that socialist firms are better for employees.
The logical inference here would be that socialist firms make for happier employees.
Is this a reasonable summary?
However, in the “Are socialist firms good for employees?” section, you do not give much evidence that workers in socialist firms are significantly happier. Instead, the paragraph says things like:
Giving employees stock in a company seems to boost their performance.[33] Research has shown that employees getting more ownership of the company is associated with higher trust, perception of fairness, information sharing and cooperation.[34] There seems to be a small increase in companywide productivity[33], while employee retention is boosted.[35] Perhaps capitalist firms could slowly be eased into becoming socialist firms by first giving the employees more stakes in the company and then expanding their participation rights.
These things, while maybe valuable, does not give that much overall evidence for life satisfaction or happiness.
Overall I am not sold that your argument-as-stated is sound, even if every individual piece of evidence is true (which is of course unlikely).
These things, while maybe valuable, does not give that much overall evidence for life satisfaction or happiness.
I wanted to give a brief summary of the literature so as to not make the post too drawn-out. But I’ll go over it in more detail:
I mentioned that source [14] found that co-ops create more social trust. But what did they find exactly? Sabatini et al investigated the role of cooperative enterprise in the creation of social trust in Italy. They find that, unlike any other type of enterprise, cooperatives have a particular ability to foster the development of social trust. This supports the view that the development of cooperative enterprises—and, more generally, of less hierarchical models of governance and of enterprises that do not aim purely to maximize profit—may play a crucial role in the diffusion of trust and in the accumulation of social capital. Trust reduces uncertainty and transaction costs, enforces contracts, and facilitates credit at the level of individual investors, thereby enhancing the efficiency of exchanges and encouraging investment in ideas, human capital and physical capital.
Now this study isn’t perfect. The cross sectional design of the survey has prevented it from controlling for fixed effects at the individual level. In addition, it did not carry out fully randomized experiments, and it has not been able to isolate suitable instrumental variables. Hence, it cannot exclude the existence of some form of endogeneity leading to inconsistent estimates. Still, this is the best study we have so even if it’s not 100% certain, it’s already very promising.
In the post I summarized the work of Blasi et al as:
Research has shown that employees getting more ownership of the company is associated with higher trust, perception of fairness, information sharing and cooperation.
How they researched this is by studying the effect of employee ownership on company culture and function. The analysis of the data set finds that shared ownership forms of pay are associated with high-trust supervision, participation in decisions, and information sharing, and with a variety of positive perceptions of company culture, plus, it’s also associated with lower voluntary turnover and higher return on equity. The random-effects estimates mainly reflect comparisons between firms rather than within firms, which means it’s possible that there are unobserved firm characteristics that help account for the findings. Nevertheless, these results indicate that group incentives are likely to have positive effects if implemented in the appropriate way – with supportive HR policies rather than on their own. (Additionally these results indicate that public policy supporting group incentives, which may be motivated by a concern to increase middle class incomes and share the rewards of economic performance more broadly, is unlikely to harm and may even improve economic performance.)
I don’t consider source [31]to be strong evidence, so maybe skip this section if you’re short on time. Joshi(not Yoshi)et al. investigated 2 major cooperative leagues (Mondragon in Spain and La Lega in Italy) and the way they interact with other cooperatives and form economies of scale. The findings suggest that coops perform better in markets which have a pre-established cooperative league. This promotes a workforce with more cooperation and social cohesion which is linked to higher worker satisfaction.
On to [34]. Coad et al. analyzed the causal linkages between well-being, income, health problems, worries, autonomy and hours worked in the job for working German individuals from 1984-2008. Given that autonomy and hours worked are the key causal drivers, it seems that individuals first choose their career trajectory in terms of autonomy or personal freedom, then decide how much to work (intensity down this trajectory), and well-being (work satisfaction and life satisfaction) is the result of these decisions. Finding that autonomy is such an important non-pecuniary determinant of individual well-being is consistent with the predictions of self-determination theory and prompts a more prominent role for autonomy in labour economics. Individuals aiming at improving their workplace and general well-being are better off seeking out work that allows them room for self-determined action and discretion.
Source [35],Park et al, investigates the relationships between job demands and job search behaviour in regards to employee attitudes and behaviour for cooperatives in Seoul, South Korea. The findings revealed that worker cooperatives moderated the relationship between job demands and organizational commitment, in other words, while the negative relationship between job demands and organizational commitment was significant in capitalist firms, it was not maintained in worker cooperatives. A potential limitation of the present study is that individual-level variables were measured by self-reports (I personally don’t find this that severe).
Lastly, I didn’t put this source in the post, but it can be considered an additional piece of evidence:
Effects of Cooperative Membership and Participation in Decision Making on Job Satisfaction of Home Health Aides, byDaphne P. Berry examines job satisfaction and participation in decision making in three home health aide facilities with different organizational structures (worker-owned for-profit, for-profit with no participation or ownership by workers, and nonprofit). More than 600 surveys were completed by home health aides across the three facilities. The author also engaged in participant observation during training sessions and other meetings and conducted a small number of interviews with caregivers and agency management. Home health aides at the worker-owned, participative decision making organization were significantly more satisfied with their jobs. This study involved respondents from one of each type of business. I didn’t include it because it doesn’t study it across several types of organization, which would’ve allowed more focus on the effects of the structural characteristics of the organizations.
One last effect that I mentioned in the post (that we shouldn’t neglect) is the positive impact on the families of the employees when the employees are doing better.[38] I haven’t studied this aspect in depth, but I don’t think this claim is too controversial.
Apologies if I misunderstood your argument.
You open your argument with saying, in essence, that people hate their jobs and are miserable at their jobs.
You then argue that socialist firms are better for employees.
The logical inference here would be that socialist firms make for happier employees.
Is this a reasonable summary?
However, in the “Are socialist firms good for employees?” section, you do not give much evidence that workers in socialist firms are significantly happier. Instead, the paragraph says things like:
These things, while maybe valuable, does not give that much overall evidence for life satisfaction or happiness.
Overall I am not sold that your argument-as-stated is sound, even if every individual piece of evidence is true (which is of course unlikely).
The mental health aspect is important, but also, don’t forget the potential impact of economic growth: https://forum.effectivealtruism.org/posts/bsE5t6qhGC65fEpzN/growth-and-the-case-against-randomista-development
I wanted to give a brief summary of the literature so as to not make the post too drawn-out. But I’ll go over it in more detail:
I mentioned that source [14] found that co-ops create more social trust. But what did they find exactly? Sabatini et al investigated the role of cooperative enterprise in the creation of social trust in Italy. They find that, unlike any other type of enterprise, cooperatives have a particular ability to foster the development of social trust. This supports the view that the development of cooperative enterprises—and, more generally, of less hierarchical models of governance and of enterprises that do not aim purely to maximize profit—may play a crucial role in the diffusion of trust and in the accumulation of social capital. Trust reduces uncertainty and transaction costs, enforces contracts, and facilitates credit at the level of individual investors, thereby enhancing the efficiency of exchanges and encouraging investment in ideas, human capital and physical capital.
Now this study isn’t perfect. The cross sectional design of the survey has prevented it from controlling for fixed effects at the individual level. In addition, it did not carry out fully randomized experiments, and it has not been able to isolate suitable instrumental variables. Hence, it cannot exclude the existence of some form of endogeneity leading to inconsistent estimates. Still, this is the best study we have so even if it’s not 100% certain, it’s already very promising.
In the post I summarized the work of Blasi et al as:
How they researched this is by studying the effect of employee ownership on company culture and function. The analysis of the data set finds that shared ownership forms of pay are associated with high-trust supervision, participation in decisions, and information sharing, and with a variety of positive perceptions of company culture, plus, it’s also associated with lower voluntary turnover and higher return on equity. The random-effects estimates mainly reflect comparisons between firms rather than within firms, which means it’s possible that there are unobserved firm characteristics that help account for the findings. Nevertheless, these results indicate that group incentives are likely to have positive effects if implemented in the appropriate way – with supportive HR policies rather than on their own. (Additionally these results indicate that public policy supporting group incentives, which may be motivated by a concern to increase middle class incomes and share the rewards of economic performance more broadly, is unlikely to harm and may even improve economic performance.)
I don’t consider source [31] to be strong evidence, so maybe skip this section if you’re short on time. Joshi (not Yoshi) et al. investigated 2 major cooperative leagues (Mondragon in Spain and La Lega in Italy) and the way they interact with other cooperatives and form economies of scale. The findings suggest that coops perform better in markets which have a pre-established cooperative league. This promotes a workforce with more cooperation and social cohesion which is linked to higher worker satisfaction.
On to [34]. Coad et al. analyzed the causal linkages between well-being, income, health problems, worries, autonomy and hours worked in the job for working German individuals from 1984-2008. Given that autonomy and hours worked are the key causal drivers, it seems that individuals first choose their career trajectory in terms of autonomy or personal freedom, then decide how much to work (intensity down this trajectory), and well-being (work satisfaction and life satisfaction) is the result of these decisions. Finding that autonomy is such an important non-pecuniary determinant of individual well-being is consistent with the predictions of self-determination theory and prompts a more prominent role for autonomy in labour economics. Individuals aiming at improving their workplace and general well-being are better off seeking out work that allows them room for self-determined action and discretion.
Source [35], Park et al, investigates the relationships between job demands and job search behaviour in regards to employee attitudes and behaviour for cooperatives in Seoul, South Korea. The findings revealed that worker cooperatives moderated the relationship between job demands and organizational commitment, in other words, while the negative relationship between job demands and organizational commitment was significant in capitalist firms, it was not maintained in worker cooperatives. A potential limitation of the present study is that individual-level variables were measured by self-reports (I personally don’t find this that severe).
Lastly, I didn’t put this source in the post, but it can be considered an additional piece of evidence:
Effects of Cooperative Membership and Participation in Decision Making on Job Satisfaction of Home Health Aides, by Daphne P. Berry examines job satisfaction and participation in decision making in three home health aide facilities with different organizational structures (worker-owned for-profit, for-profit with no participation or ownership by workers, and nonprofit). More than 600 surveys were completed by home health aides across the three facilities. The author also engaged in participant observation during training sessions and other meetings and conducted a small number of interviews with caregivers and agency management. Home health aides at the worker-owned, participative decision making organization were significantly more satisfied with their jobs. This study involved respondents from one of each type of business. I didn’t include it because it doesn’t study it across several types of organization, which would’ve allowed more focus on the effects of the structural characteristics of the organizations.
One last effect that I mentioned in the post (that we shouldn’t neglect) is the positive impact on the families of the employees when the employees are doing better.[38] I haven’t studied this aspect in depth, but I don’t think this claim is too controversial.