| The three essays of this dissertation explore some recent changes in American labor market institutions.;Chapter 2 looks at the issue of outsourcing of janitorial and security services. Outsourced workers receive lower wages, are less likely to have employer provided health benefits, and have lower unionization rates and lower union wage premia. Observable worker skills, some types of unobservable worker ability, as well as characteristics of outsourcing industries cannot fully account for most of the wage and benefit differences. The results suggest that outsourcing shifts some rents both for unionized and non-unionized workers. Consistent with this interpretation, outsourcing has occurred at a greater rate in industries with historically high wage premia.;Chapter 3 looks at shared compensation systems and employee involvement programs. In the 1990's, shared compensation systems (profit-sharing, gain-sharing, and employee ownership) and shared decision-making systems (various employee involvement (EI) programs) usually went together. Both EI and shared compensation systems increase employee input into production decisions and raise general employee satisfaction. However, the impact of shared compensation systems seems contingent on the presence of EI programs. Finally, this impact seems robust to unobserved "firm effects" as well as comparability of reference groups.;Chapter 4 presents a model for understanding independent contracting, based on how the law differentially accords property rights to common law employees as opposed to independent contractors. In the realm of intellectual property rights, default rules of assignment used by courts favor the firm relatively more when the worker is a direct employee. When contracts between workers and the firm are incomplete, the employment relation (as opposed to independent contracting) gives the firm greater rights to expropriate workers' investments, making it is easier for it to replace a worker. When the owner's incentives are unimportant, the firm chooses independent contracting. Conversely, when the worker's incentives are unimportant, the firm picks employment at will. When full ex-ante transfers are not possible, employment at will may be picked because it gives the owner a greater share of rents. |
