Wal-Mart and local economies

Professor Steven Bainbridge has written before about the economic impact that Wal-Mart has on a community. Today, he writes:

More on Wal-Mart: Employee Involvement
My post on the conservative case against Wal-Mart generated a lot of email and blog responses, several of which I plan to discuss in the next couple of days. One of the most interesting came from Max Sawicky, who makes a number of good points. I want to particularly note his invocation of employee involvement in corporate decision making:

The most interesting point in the post goes to the democratic implications of easy entry of markets by small, entrepreneurial firms. Such entry is thwarted by the dominance of Walmart-scale retail firms. The left can be a bit scrambled on this count. The left has a thing about business, while the right has a thing about labor. The left can talk about the merits of industrial democracy -- workers having more say in how their workplaces are run, the merits of flexible assignment of tasks in a workplace, flexible arrangements in work schedules, and representation on boards of directors. These are all of course privileges of working for yourself, the logical escape from wage slavery.

Max thus seemingly raises the interesting question of whether industrial democracy is a substitute good for individual ownership of a small business. I would argue that it is not - or, perhaps more precisely, that it in practice employee involvement has not proven to be a useful substitute for ownership of one's own business.

Professor Bainbridge then talks about Employee Involvement and how it doesn't really change anything. In his opinion:

In other words, I view employee involvement - at least as actually used in US corporations - as not an escape from what Max calls "wage slavery," but rather a top-down phenomenon intended to redress certain problems associated with the growth of bureaucratic hierarchies within US corporations. In my article Employee Involvement in Workplace Governance Post-Collective Bargaining, I elaborated the analysis, using transactional economics to argue that employees are better served by traditional collective bargaining than by the various forms of industrial democracy. Finally, in my article Corporate Decisionmaking and the Moral Rights of Employees: Participatory Management and Natural Law, I rejected arguments that employees have a moral right to participate in corporate decision making (as contrasted to a moral right to act collectively through unions).

I had previously written about Wal-Mart here, here, here, here and here