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Should We Clash or Should I Go? The Impact of Low Wage and Poor Working Conditions on the Exit‐Voice Trade‐Off
Author(s) -
Godechot Olivier,
Salibekyan Zinaida
Publication year - 2019
Publication title -
labour
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.403
H-Index - 34
eISSN - 1467-9914
pISSN - 1121-7081
DOI - 10.1111/labr.12155
Subject(s) - wage , low wage , action (physics) , quality (philosophy) , collective action , economics , labour economics , index (typography) , microeconomics , business , computer science , political science , philosophy , physics , epistemology , quantum mechanics , politics , world wide web , law
We use two linked employer–employee datasets to adapt Hirschman's model of consumer behaviour into the labour market and to argue that dissatisfaction with pay should favour exit while dissatisfaction with working conditions should favour voice. A deterioration of our working conditions index increases the probability of participation in collective action when an increase in log hourly wage decreases the probability of quitting. A rationale for this trade‐off is based on information: first, information on the price of alternative options is more accessible than information on their quality; second, voice produces more information than exit and favours opportunities for specific improvements.