The Origins &

Evolution of the FielJ. of

INDUSTRIAL
RELATIONS
in the United States
 The Origins &
Evolution of the Field of

INDUSTRIAL
RELATIONS
in the United States

CORNELL STUDIES

IN INDUSTRIAL AND

LABOR RELATIONS

NUMBER 25

Made available through special consideration

exclusively for current members of the Labor and
Employment Relations Association. Any distribution
or use of the content, in whole or in part, without the
permission of Cornell University Press is prohibited.

BRUCE E. KAuFMAN

ILR PRESS
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CoRNELL UNIVERSITY PREss

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 Copyright© 1993 by Cornell University

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thereof, must not be reproduced in any form without permission in writing from
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First published 1993 by ILR Press.

Second printing 1995 by ILR Press/Cornell University Press.

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Kaufman, Bruce E.
The origins & evolution of the field of industrial relations in the United States.
p. cm.-(Cornell studies in industrial and labor relations; no.25)
Includes bibliographical references and index.
ISBN 0-87546-191-3 (alk. paper).-ISBN 0-87546-192-1 (pbk.: alk. paper)
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T o L a u r e n a n d An d r e 'W
 CoNTENTS

PREFACE u
INTRODUCTION xiii

CHAPTER 1 The Origins of Industrial Relations 3

CHAPTER 2 The Schism in Industrial Relations 19

CHAPTER 3 Industrial Relations in the Interwar Years 45

CHAPTER 4 The Institutionalization of Industrial Relations 59

CHAPTER 5 The Golden Age of Industrial Relations 75

CHAPTER 6 The Hollowing Out of Industrial Relations 103

CHAPTER 7 Industrial Relations in Decline 137

CHAPTER 8 Industrial Relations in the 1990s and Beyond 157

SuMMARY AND CoNCLUSION 187

NoTES 199

REFERENCES 253

INDEX 281
 PREFACE

W HEN 1 STARTED this project three years ago I had no idea

that it would grow to be a book or that the conclusions
would take the shape they have. The book had its genesis
in two developments. The first was that I was assigned to teach a
new graduate course we had just introduced into the curriculum at
Georgia State University, the purpose of which was to survey the
evolution of thought and practice in the field of "employment rela-
tions" -a term the faculty adopted as a way to provide an intellectual
umbrella for consideration of both industrial relations and personnel
management in one course. The second development was that in 1989
I was appointed director of the newly created Beebe Institute of
Personnel and Employment Relations at Georgia State. The institute
had been the Institute of Industrial Relations, but in 1988, in response
to declining student and faculty interest in industrial relations, a
decision had been made to refocus the institute's activities on personnel
and human resource management.
These events stimulated my interest in learning more about the his-
tories of the fields of industrial relations and personnel management and
their underlying theoretical paradigms, both because I had to discuss
these matters in class and knew precious little about them (having been
trained as a labor economist) and because I soon discovered in my new
role as institute director that faculty from the industrial relations and
personnel wings of the field have quite different conceptual and meth-
odological approaches to research on the employment relationship. To
learn more, I set off for the library, where I soon discovered that relatively

ix
 Preface

little had been written on the histories of either industrial relations or

personnel management but particularly the former. I also discovered
that what had been written was almost completely silent with regard to
the relationship of one field to the other, especially the differences and
commonalities in intellectual origins, theoretical paradigms, and un,
derlying philosophies and ideologies.
This book is the result of my investigations. The book has three
objectives. The first is to provide a detailed account of the intellectual
history of the field of industrial relations, its relationship to personnel
management (and related fields such as organizational behavior), and
the historical development of the major institutions of industrial rela,
tions in American academe, including university degree programs and
professional associations. The second objective is to assess the reasons
for the marked decline in the field's intellectual and organizational for,
tunes over the last two decades, a decline that has proceeded to the
point that the continued existence of industrial relations programs at a
number of universities is threatened. Finally, the third objective is to
develop a strategy for change that will preserve and strengthen industrial
relations as a field of study, if not in name then in intellectual spirit.
My findings and conclusions are both revisionist and critical; revi,
sionist with respect to the conventional wisdom regarding the intellec,
tual roots of industrial relations as a field of study and its early {pre,
1950s) relationship to the study and practice of personnel management,
and critical of the direction the field has taken since the late 1950s and
of the role played therein by the field's major professional group, the
Industrial Relations Research Association. When I started this project,
I had neither revisionism nor criticism in my heart since both strike at
the institutional tradition in industrial relations, which, given my Uni,
versity of Wisconsin background in labor economics, holds a strong
appeal for me. Nevertheless, as I dug deeper into the history of the field
I came to realize that institutionalism was but one of two major streams
of thought in industrial relations (rather than the predominant stream,
as often alleged) and that some of its major assumptions, and the policy
conclusions that flow from them, are in serious need of critical evaluation
and revision. These conclusions, and my perception that the majority
of academics active in industrial relations in the post, 1960 period have
held opposite views, inevitably led me to take a revisionist and critical
stance. While I have not shrunk from identifying shortcomings where

X
 Preface

I see them, I have also labored to be fair and accurate to all parties and
points of view. My intent is to stimulate constructive dialogue, not to
cause heartburn.
A central theme of this book is that research in industrial relations
has been animated by two very different impulses: science-building (the
advancement of knowledge for its own sake) and problem-solving (the
application of knowledge to solve practical problems). These impulses
have given the field a split personality-researchers interested in
science-building seek to tum the field into a distinct discipline with its
own overarching theoretical framework, while the problem-solvers find
its multidisciplinary nature a rich source from which to mix and match
specific theories and concepts to issues of practice and policy.
This book exhibits much the same split personality. In part, it is a
science-building exercise in historical analysis (albeit of an interpretive
nature) in which I attempt to trace the origins and evolution of insti-
tutions and ideas in industrial relations. But the book also has a problem-
solving dimension to it, for I am interested not only in chronicling the
development of the field but also in offering a vision for change that
will reverse the decline in the field's intellectual vital signs. The danger
in mixing these two motives, as in the broader world of IR research, is
that it blurs the purpose of the book and the nature of the intended
audience. Readers who want a straightforward history of thought text,
for example, will find the amount of space given to curricular and
programmatic developments and the development and organizational
details of the Industrial Relations Research Association to be excessive.
From my point of view, however, a consideration of these institutional
details is crucial if we are to chart a new path for the field. Such are
the tensions between science-building and problem-solving!
This book has benefited from the contributions of many people, fore-
most among them Clark Kerr, Richard Lester, and George Strauss. Each
of these men spent considerable time with me during the research phase
of the project discussing the key events, people, and ideas in the field
from the time of their first involvement with it in the 1940s to the
present time. After I had completed a first draft of the manuscript, they
also gave me detailed comments and suggestions. The manuscript has
benefited greatly from their efforts.
During the research phase of the project I also benefited from written
and telephone communications with numerous other scholars in the

xi
 Preface

field. A partial list includes Chris Argyris, Jack Barbash, Don Cullen,
Milton Derber, William Form, John Fossum, Dallas Jones, Robert Lamp-
man, David Lewin, H. Gregg Lewis, Charles Myers, Maurice Neufeld,
Lloyd Reynolds, Richard Rowan, Tony Sinicropi, Philip Way, Hoyt
Wheeler and William Foote Whyte. I also received valued assistance
from the staff of the Industrial Relations Research Association. After
completing a first draft, I sent the manuscript to numerous people for
review. I received written or telephone comments from Jack Barbash,
Don Cullen, John Delaney, John Dunlop, John Fossum, Sanford Jacoby,
Thomas Kochan, Morris Kleiner, Michael Lee, Robert McKersie, Peter
Sherer, James Stem, Hoyt Wheeler, William Foote Whyte, and Daniel
Wren. I wish to express my sincere appreciation to each of these people
for their help and assistance. All contributors and reviewers are, of
course, absolved from responsibility for errors of fact or interpretation.
Finally, I wish to acknowledge a number of other people who also
made valuable contributions to this book: Fran Benson, Erica Fox, An-
drea Fleck Clardy, and Patricia Peltekos, all of ILR Press, and Donna
Smith, who assisted me in preparing the manuscript for submission to
the publisher. Completion of this project was also aided by financial
assistance from the College of Business Administration of Georgia State
University. Last, but not least, I owe a debt of thanks to my wife,
Deborah, who somehow managed her own full-time career and two
young children while her husband worked nights and weekends to com-
plete this manuscript.

xii
 INTRODUCTION

I NDUSTRIAL RELATIONS (IR) developed as a distinct academic subject

and field of study nearly three-quarters of a century ago. In this book
I provide a historical survey of the origins and development of the
field in the United States and an analysis of the factors that contributed
both to the field's ascendancy in the decade after World War II and to
its sharp decline in the 1980s. 1
The book is motivated by three considerations. The first is that no
comprehensive account of the intellectual history of industrial relations
in the United States has heretofore been written. This omission is in
sharp contrast to the detailed histories available for the closely allied
fields of labor economics (McNulty 1980) and personnel management
(Ling 1965; Wren 1987). The only studies that provide even a modest
historical treatment of the development of the field are Milton Derber's
(1967) book on pre-1960s research on labor problems, the chapter in
Thomas Kochan's (1980) collective bargaining textbook on the histor-
ical evolution of the American industrial relations system, the survey
article by George Strauss and Peter Feuille (1981) on trends in post-
World War II IR research, and a soon-to-be-published article by Roy
Adams (1992). Other useful but more topical accounts of the field's
development are provided by James Cochrane (1979), George Strauss
(1989, 1990), Jack Barbash (1991a), and Ronald Schatz (1993). All of
these studies deal with the evolution of thought in industrial relations.
No study I am aware of has attempted to chart the institutional and
organizational development of industrial relations, including when and

xiii
 Introduction

where the first IR academic programs were established and the structure
and historical evolution of IR curricula.
The second consideration is that substantial controversy exists in the
field concerning its intellectual boundaries and core subject area (Begin
1987; Boivin 1989; Strauss 1989, 1990). Several IR scholars, for ex-
ample, define the field broadly to include the study of all aspects of the
employment relationship (Heneman 1969; Fossum 1987). From this
point of view, IR subsumes all subfields relevant to the employment
relationship, such as human resources management, collective bargain-
ing, industrial psychology, and labor law, and covers in its coursework
and research all dimensions of work, including the practice of employ-
ment relations in both union and nonunion situations.
Other people adopt a narrower interpretation that defines industrial
relations as the study of organized employment relationships, with a
particular focus on unions and collective bargaining (see Behrend 1963;
Strauss 1990). Juxtaposed to the field of IR, in this view, is the separate
field of human resources (HR), which has become associated with a
largely behavioral science approach to the study of nonunion work sit-
uations, with particular emphasis on the practice and organization of
management. This bifurcation in the study of the employment rela-
tionship is attested to, for example, in the title of the University Council
of Industrial Relations and Human Resource Programs and the title of
a textbook by Thomas Kochan and Thomas Barocci (1985), Human
Resources Management and Industrial Relations.
These starkly different visions of industrial relations have created a
significant identity problem for the field, a situation exacerbated by the
attempt of IR scholars to have it both ways-to stake out a broad, all-
inclusive jurisdiction for industrial relations when discussing the nature
of the field but to focus primarily on collective bargaining when con-
ducting research. I hope this book helps to resolve this intellectual
paradox or, if not to resolve it, at least to identify its origins and un-
derlying causes.
The third consideration motivating this book concerns the recent
decline in the vitality and academic stature of industrial relations as a
field of study and its prospects for survival and growth in the future. A
variety of signs indicate that the field of industrial relations experienced
a significant decline in the 1980s as a focal point for teaching and
research in employment relations (W. Franke 1987; Begin 1987;

xiv
 Introduction

Strauss 1990). Examples include the elimination, consolidation, or sig-

nificant downsizing of a number of academic IR programs; the elimi-
nation of the term industrial relations from academic units; the substantial
shift in students from IR courses to HR courses; and the decline in the
number of academics in the field's major professional organization, the
Industrial Relations Research Association. The hard times that have
befallen industrial relations have led some scholars to question the field's
long-term prospects for survival. Indicative of this sentiment is the
question posed by Arnold Weber (1987b:9)-"Will industrial relations
institutes and the study of industrial relations go the way of home eco-
nomics?"-and the statement by George Strauss (1989:257): "Short of
an unexpected resurgence of union victories academic IR will have to
make major adjustments. Otherwise it may follow the example of the
Cigarmakers and the Sleeping Car Porters, both leaders in their times."
Why has academic IR fallen on hard times? Will IR institutes and
IR programs stage a comeback, or will they ultimately fade from the
academic scene? What can be done to improve the prospects for the
field? Successfully answering these questions requires, I believe, a thor-
ough understanding of the field's history and, in particular, the events
and decisions that brought industrial relations to its current state. The
remainder of the book attempts to provide this context.

XV
 The Origins &
Evolution of the Field of

INDUSTRIAL
RELATIONS
in the United States
 1
THE ORIGINS OF
INDUSTRIAL RELATIONS

T HE TERM industrial relations entered the American lexicon in 1912

when President William Howard Taft proposed and Congress
approved the creation of a nine~person investigative committee
called the Commission on Industrial Relations. 1 The commission was
formed as the result of the public outcry over the death of twenty persons
in the dynamite bombing of the LA Times building in 1910 by two
leaders of the Structural Ironworkers Union (Harter 1962:131-59). The
charge given to the commission was to determine the conditions re~
sponsible for conflict between employers and employees and possible
remedies for such conflict. The commission held 154 days of hearings
and published its findings and conclusions in 1916 in eleven volumes. 2
The importance of this new subject of industrial relations was attested
to in the opening sentence of the commission's report (U.S. Congress
1916: 1): "The question of industrial relations assigned by Congress to
the commission for investigation is more fundamental and of greater
importance to the welfare of the Nation than any other question except
the form of our government."
In its initial usage, the term industrial relations was little more than a
shorthand for "the relations between labor and capital in industry," a
phrase encountered frequently before 1912. The meaning of the term
soon expanded greatly, however, and by 1920 it had come to represent
an academic field of study, a reform movement in industry, and a profes~
sional vocation.
The birth of the term industrial relations and its metamorphosis into
a subject of academic inquiry was critically influenced by several events

3
 The Origins of Industrial Relations

and ideas in the preceding half-century. An appreciation of the origins

and development of the field requires brief mention of these events and.
ideas.

LABOR PROBLEMS
The intellectual precursor of industrial relations was the concept of
"the labor problem." The term labor problem came into vogue in the
latter part of the nineteenth century and was used to connote the general
struggle between labor and capital over the control of production and
the distribution of income and the conflict engendered by this struggle
(see Barnes 1886; Olson 1894). The concept then evolved in two steps.
The first step, which occurred shortly after the tum of the century,
was a movement away from the unitary conception of the labor problem
to a pluralistic conception of labor problems (Adams and Sumner 1905;
Watkins 1922). 3 The pluralistic version represented an intellectual ad-
vance in that it recognized that labor problems take many different forms
besides labor-management conflict, that labor problems afflict both em-
ployers and workers, and that labor problems exist in both socialist and
capitalist economies. Commonly cited examples of labor problems facing
employers were high employee turnover, worker "soldiering" (loafing),
and excessive waste and inefficiency in production, while labor problems
affecting workers included insecurity of employment, low pay, child
labor, and unsafe working conditions.
The second step, which occurred gradually after World War I, was
the replacement of labor problems with a terminology that was more field-
specific. Thus, the term labor problems continued to be used in labor
economics but was gradually replaced by personnel problems in personnel
management, social problems in sociology, and so on. 4 It was not until
the late 1940s-early 1950s that the "problems" perspective began to fall
out of favor in the social sciences, for reasons discussed in chapter 6.
The concept of labor problems was crucial to the development of
industrial relations because it provided both an intellectual justification
for the field and a focal point for research and teaching (Derber 1967).
When the labor problems perspective first emerged it was as a reaction
against the policy conclusions derived from the intellectual doctrines of
classical economics and social Darwinism. As discussed in more detail
in chapter 2, classical economics purported to show that competition
in free, unregulated labor markets promotes efficiency in production and

4
 The Origins of Industrial Relations

a harmony of interests between labor and capital. Social Darwinism held

that economic and social progress is best promoted by unrestrained
competition since the competitive struggle weeds out the weaker mem-
bers of society and allows the strongest members to rise to the top to
take their place as the nation's business and political leaders. Both
doctrines were used by conservatives to justify the prevailing system of
laissez-faire capitalism, the dominance of the existing business and po-
litical elites, and the hostile attitude of legislatures and courts toward
labor union activity and protective labor legislation (Bendix 1956; Dorf-
man 1959). 5
The concept of labor problems was thus developed by both social
reformers and socialist revolutionaries as a means to attack the status
quo in industry since, if it could be shown that the employment rela-
tionship contained serious maladjustments and defects, then the case
for laissez-faire was weakened and the case for reform (or revolution)
was strengthened. The reformers and revolutionaries diverged, however,
as to the best approach to resolve these problems.
The reformers accepted the capitalist system but sought to improve the
efficiency and equity with which it operated through more scientific and
humane management methods, an equalization of bargaining power be-
tween workers and employers, and the introduction of democracy and due
process into the workplace. This approach was to become the intellectual
and policy core of the new field of industrial relations. From the point of
view of the reformers, labor problems and industrial relations were oppo-
site sides of the same coin-labor problems were the undesired behavioral
outcomes generated by the defects and maladjustments in the employ-
ment relationship, while industrial relations was the body of theory and
methods that would resolve or ameliorate the problems (Watkins 1922).
Marxists and socialists were antagonistic to the new field of industrial
relations since it sought to save through reform what they hoped to
replace through revolution. 6 These groups largely shunned industrial
relations and instead subscribed to Marxist economics, political action
through the Socialist party, and direct job action through unions such
as the Industrial Workers of the World (IWW).

CAUSES OF LABOR PROBLEMS

just as the concept of labor problems provided the intellectual jus-
tification for the field of industrial relations, the perceived causes of

5
 The Origins of Industrial Relations

labor problems heavily influenced its theory, practice, and philosophy.

Labor problems, such as conflict between employers and workers, in-
security of employment, and worker soldiering on the job, did not sud-
denly appear in the late nineteenth century. To one degree or another,
these problems had been evident since the emergence of free labor
markets and a wage labor force several hundred years earlier. What was
new was the scope and intensity of many of these problems, a devel-
opment most graphically illustrated by the unparalleled violence and
radicalization of emotions associated with such labor-management dis-
putes as the Homestead, Pullman, and anthracite coal strikes of the late
1800s.
Early writers on the subject of labor problems identified three reasons
in particular for this trend (Adams and Sumner 1905; Commons 1911;
Watkins 1922; Furniss 1925). The first was the rise oflarge-scale, capital-
intensive, bureaucratic forms of business organization. Before the late
nineteenth century, most of the country's employment was in agricul-
ture. Nonagricultural forms of business, such as in manufacturing, min-
ing, and construction, were typically small-scale operations that
employed skilled craftsmen using hand tools and were managed by the
owner-entrepreneur. After 1870, however, the industrial sector expe-
rienced a fundamental transformation (Nelson 1975). From 1870 to
1920, average employment in manufacturing plants in most industries
doubled and tripled. Likewise, the production process was transformed
as machines replaced hand tools, skilled craftsmen were replaced by
semiskilled or unskilled operators and assemblers, and standardized, in-
terchangeable parts replaced customized parts. Finally, the corporate
form of business organization gained popularity, with a consequent sep-
aration of ownership and control, as a salaried cadre of management
officials took over responsibility for day-to-day operation of the firm.
These events increased the potential for conflict and other forms of labor
problems in the workplace by increasing the physical and social distance
between workers and employers, "proletarianizing" the work force into
a large, relatively undifferentiated group of manual workers, and re-
moving the status, bargaining power, and high earnings that went with
being a skilled craft worker (see Peterson 1987:9-70).
The second reason was the downward pressure on money wages and
working conditions during the last thirty years of the nineteenth century
exerted by the chronic unemployment in the labor market. The large

6
 The Origins of Industrial Relations

number of jobless workers during this period was caused by both demand
and supply factors. On the demand side, the economy was in recession
or depression roughly half the years between 1870 and 1900. The scarcity
of jobs because of the insufficient demand was exacerbated on the supply
side by the influx of millions of immigrants into the country. The result
in many urban areas was a persistent pool of unemployed workers and
cut-throat competition for jobs. Faced with numerous job seekers, many
of whom were foreign-hom and unskilled, and continual downward
pressure on prices in the product market (prices fell by one-third between
1870 and 1900), the competitive struggle to stay in business forced
employers to reduce labor costs wherever possible, be it by lowering
wages, speeding up the pace of work, or skimping on even elementary
safety precautions. The working life of most manual workers during the
period, therefore, was marked by considerable insecurity and hardship
(Lescohier 1935). The resulting social tensions were further exacerbated
by the growing affluence of the upper classes and the notable trend
toward a greater inequality in income and wealth (Williamson and
Lindert 1980).
The third reason for the increase in labor-management conflict was
the arbitrary, unsystematic, and authoritarian methods of personnel
management used in industry (Jacoby 1985). Employers generally re-
garded workers as a commodity from which maximum production should
be extracted for the least cost and then discarded when no longer needed.
Personnel departments and written policies were nonexistent before
World War I. In most plants, top management delegated all personnel
matters such as hiring, firing, pay, promotion, and work load to the
foreman in charge of each department or shop. Typically, the foreman's
decisions on these matters were final. His task was to maximize pro-
duction at minimum unit cost. To accomplish this, the accepted method
was the "drive system." The drive system entailed constant supervision
by the foreman and the use of profane language and verbal abuse to
induce the employees to work harder. The factors that made the drive
system an effective device to elicit work effort was the threat of dismissal
from the job-a threat made credible by the existence of numerous job
seekers outside the plant gate. Although employers generally found the
"foreman-in-charge" method of personnel administration and the drive
system of employee motivation to be cost-effective, these practices
nevertheless created considerable tension and dissatisfaction among em-

7
 The Origins of Industrial Relations

ployees as a result of the welter of pay differentials among workers

performing relatively similar jobs, the frequent occurrence of favoritism
by the foreman in hiring and firing decisions, the lack of an appeals
process and machinery for administration of due process in the plant,
and the autocratic, insensitive attitude exhibited by all ranks of man-
agement (see Williams 1920).
MOVEMENT FOR REFORM
Beginning in the mid-1880s, a groundswell of opinion developed that
favored reform of the employment relationship. This movement gained
speed from 1900 to 1914, in the period known as the Progressive era
(Hoffstadter 1963).
The movement for reform came from a variety of sources. Industrial en-
gineers such as Frederick Taylor promoted scientific management as a way
to resolve labor problems, 7 while industrial psychologists, such as Hugo
Miinsterberg and Walter Dill Scott, sought to use new psychological con-
cepts and methods to increase industrial efficiency and the worker's satis-
faction with the job. Institutional labor economists, such as John R.
Commons and Robert Hoxie, analyzed the economic basis of labor prob-
lems and the role of labor unions and government regulation as a means to
resolve the problems. The actions of progressive business leaders, who
voluntarily instituted various employee welfare measures (e. g., company
lunchrooms or safety directors) or installed some form of employee repre-
sentation plan, also greatly helped the movement, as did trade unionists
and their supporters, who saw unions and collective bargaining as the
most effective way to eliminate various industrial evils such as low wages
and unsafe job conditions. Support for reform also came from progressive-
minded civic and religious organizations, such as the Civic Federation
and the Quakers, as well as from socialists and other left-wing political
and economic groups that constantly called attention to the deplorable
conditions in industry and the depredations of the business class. Finally,
several government commissions materially advanced the campaign by
exposing the many abuses and hardships experienced by workers. Among
these were the United States Industrial Commission (1898-1902) and
the Commission on Industrial Relations ( 1913-15).
WORLD WAR I: THE CATALYST FOR CHANGE
Before World War I, most employers treated the reform movement
with indifference or hostility. The reasons included resistance to change,

8
 The Origins of Industrial Relations

the continued effectiveness of traditional methods of labor recruitment

and management, and the gradual erosion of the union threat after
1904. As long as only progressives and liberals advocated reform, and
in the absence of government action, little headway was likely.
The situation changed dramatically, however, as a result of the eco·
nomic and political events during World War I (Stichter 1919a; Douglas
1919, 1922;Jacoby 1985). Warproductionsoonbroughtonalaborshort·
age, compounded in 1917 by the draft. The result was a serious disruption
of old methods of personnel administration. With numerous job oppor-
tunities, labor turnover (already quite high) increased dramatically. Fur·
ther, work effort and productivity declined significantly. The drive system
performed reasonably well when backed up by the fear of unemployment,
but it lost its effectiveness when workers no longer feared for their jobs. Fi-
nally, the surge in inflation and low unemployment brought on a resurg-
ence of union organizing, wage demands, and strikes.
World War I also led the federal government to become more inter·
ested in reform. The Commission on Industrial Relations had been
appointed to determine the origins of labor problems, but its liberal
leanings had caused Congress to ignore its opinions (Harter 1962). The
exigencies of World War I, however, increased the interest in labor
problems. During the Wilson administration, policies favorable to or·
ganized labor were promulgated, most particularly by the War Labor
Board, which encouraged companies in war-related industries to rec-
ognize unions voluntarily and to sign collective bargaining contracts.
The impetus for these pro-labor policies came partly from ideological
convictions and partly from a pragmatic desire on the part of government
officials to minimize strikes and disruptions to production (a goal that
was only partially achieved).
The net outcome was that by the end of World War I all the major
parties to the employment relationship had concluded that workplace
reform was in their self-interest, although considerable controversy re-
mained as to its precise nature. It was out of this push for reform that
the new field of industrial relations was born.

EsTABLISHMENT OF INDUSTRIAL RELATIONS AS A

FIELD OF STUDY
During World War I the term industrial relations began to appear with
greater frequency in the popular and trade press as citizens, practitioners,

9
 The Origins of Industrial Relations

and policy makers debated the causes and cures of the breakdown in
employer-employee relations. 8 Given the severity of the labor problems
at this time, the widespread interest in employment reform, and the
absence of organized research and teaching on the subject of the em-
ployment relationship, the term soon came to describe a new subject
area or field of study. The focal point of this new field was the em-
ployment relationship and, in particular, the causes of labor problems
and their resolution through improved methods of administration and
organization.
The birth of industrial relations as an independent field of academic
study was marked by the establishment in 1920 of the Bureau of Com-
mercial and Industrial Relations in the extension division of the Uni-
versity of Wisconsin and of a "course" (area of specialization) in
industrial relations in the Department of Economics, under the direction
of John R. Commons (U.S. Department of Labor 1921). This special-
ization was, as far as I can determine, the first academic program of
study in industrial relations at an American university. Students taking
the specialization enrolled in four subjects: labor legislation, labor history
and industrial government, labor management, and causes and remedies
of unemployment.
The new field of industrial relations was soon introduced at other
major universities. In 1921, the Industrial Research Unit was established
at the Wharton School of Business and Commerce of the University of
Pennsylvania to promote research on the problems of industry (Wharton
School 1989). For the first decade research conducted by the unit was
focused almost exclusively on industrial relations topics. In later years,
several studies on the economics of the mining, metals, and textile
industries were also published.
The first academic unit devoted specifically to industrial relations was
created in 1922 by Princeton University with the establishment of its
Industrial Relations Section in the Department of Economics (Industrial
Relations Section 1986). The purpose of the section was to foster re-
search on industrial relations, principally through published reports and
monographs by the faculty associated with the section and the devel-
opment of a comprehensive library of industrial relations materials. At
Harvard University industrial relations appeared in 1923 when the Jacob
Wertheim Research Fellowship for the Betterment of Industrial Rela-
tions was established. Finally, in 1925, the University of Chicago pro-

10
 The Origins of Industrial Relations

moted Paul H. Douglas from associate professor of economics to professor

of industrial relations (Douglas, Hitchcock, and Atkins 1925:
frontispiece). 9
Among practitioners, three events helped establish a separate identity
for industrial relations. The first event was the publication in October
1919 of the monthly periodical Industrial Relations: Bloomfield's Labor
Digest, by Daniel and Meyer Bloomfield, two prominent writers and
consultants to business on the subject of employment management.
The second event was the formation of the Industrial Relations As~
sociation of America (IRAA) in 1920. The IRAA had formerly been
the Employment Managers' Association and was composed largely of
business people with an interest in personnel work. The association had
more than two thousand members and several dozen local chapters in
its first year. 10 Among its activities, the IRAA published a monthly
journal entitled Personnel. Financial distress associated with the severe
recession of 1920-21 forced the dissolution of the association in early
1922. Its activities were absorbed by a new organization, the National
Personnel Association, which in 1923 changed its name to the American
Management Association (Lange 1928).
The third event was the passage of the Kansas Industrial Court Act
of 1920, which established the Kansas Court of Industrial Relations,
the first such court in the nation. The court was authorized to settle
labor disputes in the state through binding arbitration (see Feis 1923).

INDUSTRIAL RELATIONS DEFINED

What was this new field of industrial relations that had suddenly given
birth to a new professional organization in industry and a course of study
and area of research in academe? A review of the early literature of the
field reveals that the answer had several parts.
Every field of knowledge is directed at the study of certain key forms
of behavior. Economics, for example, focuses on the operation of markets
and the determination of market outcomes such as wage rates and em~

Q
ployment levels, while sociology examines social groups and behaviors
ch as status differentiation and mobility across social classes. lndustriaD
elations was thought to focus on the employment relationship and, in
articular, on the relationship between employers and workers and the
bor problems that grow out of this relationship. 11
This conceptualization of the field was most clearly enunciated in an

II
 The Origins of Industrial Relations

internal research report prepared by the Social Science Research Council

(1928) entitled Survey of Research in the Field of Industrial Relations. The
report was written by Herman Feldman, a professor of industrial relations
at Dartmouth College, with the assistance of a twelve-person advisory
committee composed of academics, including John R. Commons,
George Barnett, and Joseph Willits, businessmen, trade unionists, and
government officials. The report states (p. 22), "The only satisfactory
basis of distinguishing a body of knowledge from another is in the prob-
lems studied." It goes on to say that labor problems provide the focal
point of investigation for industrial relations. Specifically, it defines the
field as "including those problems of human behavior involved in the
reciprocal relations of the worker with four types of situations: his work;
his fellow-worker; his employer; and the public."
Industrial relations was also seen at the time as a multidisciplinary
field of study, rather than as a distinct discipline of its own. 12 An
academic subject area is considered a discipline if it focuses on a con-
ceptually unique or distinctive form of behavior and possesses a theo-
retical framework for organizing and investigating the activity in
question. Based on this criterion, industrial relations was not thought
to qualify as an academic discipline since the study of the employment
relationship, and the labor problems therein, was based largely on knowl-
edge and theories from existing disciplines rather than on a knowledge
base and theoretical framework unique to industrial relations.
The multidisciplinary character of industrial relations, as seen by the
field's leading participants in the 1920s, is vividly illustrated by the
disciplinary "map" of the field contained in the report of the Social
Science Research Council (see fig. 1-1). 13 Across the top of the map
are the four employment relations that are the focus of the field, while
vertically are listed more than a dozen disciplines or fields of study that
in some way contribute to the study of these relations. The cells of the
map give examples of subjects from each discipline that are relevant to
the respective employment relation. As figure 1-1 suggests, industrial
relations in the 1920s was defined very broadly, both in terms of the
employment relation studied (e.g., vertical "man-boss" relations within
a firm; horizontal worker-worker relations both within a firm and across
firms) and the disciplines that were considered part of the field.
Industrial relations was also depicted in the early literature as an
exercise in both "science-building" and "problem-solving. " 14 Science-

12
 The Origins of Industrial Relations

building is concerned with the advancement of knowledge for its own

sake. The development of theory is critical to science-building in that
a theoretical framework is essential for formulating a research design,
deducing hypotheses, and providing a consistent, unifying explanation
for the behavior under study. In contrast, problem-solving has a more
applied, empirical, and normative orientation. The goal is to identify
the root cause of the problems under study and how they might best be
resolved. Although early scholars in industrial relations saw science-
building as part of their goal, their involvement in the field was animated
principally by a desire to achieve more scientific, equitable, and humane
employment practices through both progressive labor legislation and
improved methods of employment management in industry (Derber
1967). Indicative of this applied orientation is the statement by John
Calder (1924:vii) that "the term 'Industrial Relations' ... now signifies
a body of definite, liberal policies and practices dealing chiefly with the
common economic interests of the employee and employer" and, in a
similar ~ein, the statement by Gordon S. Watkins (1928:5) that "in-
dustrial conflict is often characterized as the greatest problem of industrial
civilization, and that scientific administration of industrial relations is
described as its most imperative need."
Finally, scholars in every academic field wish to use the theories and
facts they develop to promote , or advance the economic and social
interest of the nation. Accordittg to early writers on the subject, the
discovery and implementation of successful methods of industrial rela-
tions would lead to three such benefits: greater efficiency in production;
greater equity in the distribution of economic rewards, the utilization
of labor, and the administration of employment policies in the work-
place; and greater individual happiness and opportunities for personal
growth and development (Tead and Metcalf 1920:2-3; Watkins 1922:5-
6; Scott and Clothier 1923; Furniss 1925:534-35). 15 Industrial relations
was to lead to increased efficiency through such means as improved
production methods, motivation, supervision, and cooperation between
management and workers. Greater equity in pay, working conditions,
and authority was to be achieved through such means as improved
compensation systems, workman's compensation laws, and works coun~
cils or trade unions. Finally, a greater personal sense of well-being on
the part of workers and managers was to be achieved by promoting due
process in plant administration, enhanced individual dignity and respect

13
FIGURE 1.1 Map Suggesting the Field of Research in Industrial Relations
III.
Illustrative Problems Arising in Industry
Affecting
THE WORKER IN RELATION TO HIS WORK
I. II. (Objective conditions of the job, personal
Sciences Nearest Related to Studies FACTORS IN HUMAN BEHAVIOR condition of the worker, attitude
of Factors in Human Behavior With special reference to industry towards task)

Geography EXTERNAL PHYSICAL (I)

Anthropo-geography ENVIRONMENT A. 1. Effects of seasons on man
Anthropology A. Climate in general (Temperature, 2. Improvement of external aspect of
sunlight, altitude) workplace environment
Physics and Engineering
(Ventilation, lighting, noise and
llluminaring Engineering
vibration in the purely technical
Chemistry aspects)
Agricultural Economics B. Natural resources and nearness to food B. I. Availability of free land for cultivation
Mining and Merallurgy supply 2. Distance from plant and difficulties of
Transportation Economics getting to wurk. (Probably belongs in
Mechanical Engineering Box 13 or 16)
Safety Engineering C. External physical h323rds C. Traumatic hazards of the job
Industrial Engineering I. Natural-cave-ins, floods
2. Artificial--explosions, collapse of
walls, etc.

BODILY (PHYSICAL) (5)

CAPACITIES A. Medical problems of worker in a job
Biology, Biophysics, and Biochemistry A. Bodily capacities I. Physical fitness for the job
I. Physique 2. Posture, pace, physical fatigue
Anatomy 2. Physiological functioning (glandular 3. Change of physical power with af'
activity, stamina, etc.) 4. Occupational diseases and genera
Physiology infections
Endocrinology 3. Neurological endowments or defects
Bacteriology (genius, feeble-mindedness)
Neurology
Anthropology B. Inherited racial characteristics (not B. Fixed racial traits (if any) affecting work,
including nationality) viz: alleged laziness of negro

C. Inherited sex characteristics C. Sex disabilities, phr,ical and mental

Special problems o women in industry

INDIVIDUAL MENTAL (9)

RESPONSES A. Vocational guidance and employee
Psychology A. 11 Mental" traits selection
Employment Psychology I. Instincts and impulses I. Psychological tests
"Industrial Psychology" 2. Mental capacities 2. Capacity for transfer, training, and
a. Alertness, dexterity, intelligence, promotion
etc. B. Detection and appraisal of personality
b. Special talents traits
I. Discovery of potential leaders
B. "Personality" traits 2. Promotion problems; college men in
1. Emotional bias business
2. Habits C. Psychological and psychiatric problems of
3. "Drive" work, such as
(Courage, ambition, perseverance, I. Monotony, fatigue, rest periods, hours
initiative, will~power, ecc.) of work
2. "Floaters," labor turnover
3. Interest in work., incentives, methods
Psychiatry C. Mental conflicts and control of wage payment
I. Reaction to anxieties and strains 4. Tools and methods of work
Mental Hygiene 2. "Compensations," complexes, 5. Reaction to insecurity, thrift plans,
neuroses, etc. stock ownership, personnel work,
3. Adaptation to environment scientific management, etc.
6. Mental factors in accidents and
inefficiency
Social Psychology 7. Obsessions, neuroses, and other mental
D. Social sensitiveness hygiene problems
I. Behavior patterns and acquired D. I. Conscious restriction of output
attitudes 2. Dissatisfaction due to fancied
2. Susceptibility to mob or social pressure injustices, etc.

Figure continues on pp. 16-17.

14
 VI.
IV. v. Illustrative Problems Arising in Industry
Illustrative Problems Arising in Industry Illustrative Problems Arising in Industry Affecting
Affecting Affecting THE WORKER IN RELATION TO
THE WORKER IN RELATION TO HIS THE WORKER IN RELATION TO THE PUBUC
FELLOW•WORKER HIS EMPLOYER (Consumer, semi-public agencies, police,
(At his side, in his plant, in his union, in (Foreman, manager, owner, employing class, government, legislatures, couns,
his community or in the world at large) investor, capitalist, banker) commissions)

(2) (3) (4)

A. 1. Fights in plant, grievances, irritability, A. I. Greater difficulty of maintaining A. Sanitary regulations and industrial code.
due chiefly to changes in climate (!) discipline in certain seasons ( 1)
2. Employer's responsibility for good
physical environment B. I. General housing problem
2. General transponation problem of
B. I. Physical layout of mining camps workers living at disrance from plant
(!)
2. Industrial housing (!) C. Safety codes and legislation for building
construction, mechanical equipment, etc.
C. Mechanical engineering aspects of
safety for which employer may be
held responsible

(6) (7) (8)

A. Conragious diseases A. Medical work of the employer A. I. General community health burden
1. First aid, health activities, etc. 2. Regulations of working periods
2. Hours of work and rest periods 3. General community old age problems
3. Finding jobs for older employee 4. Special regulations of cenain trades
4. Eradication of occupational
diseases
B.
B. Racial conflicts among workers ( ?) See Box B. Possible adaptation of type of
14, below discipline to race problems involved
C. Protective legislation for women in
c. C. Sex relations as a factor in personal industry
relationships in industry

(~)
(10) (12)
Grievances, wage difficulties, A. Qvil Service problems (selection,
and conflicts caused by unsuitability of training, promotion, etc.)
the worker for the job, or
A. Lack of sympathy or cohesion between B
personality traits of the worker,
highly efficient or highly skilled worker involving:
and the mediocre or unskilled I. Selection procedure
2. Rating, follow.. up, promotion,
ere.
B. Exploitation of workers by other more

a~}
dynamic workers, existence of 11agitarors," Discipline problems caused by B. Accidents and damage caused by
"firebrands," etc. I. Poor leadership by foremen, improperly selected motormen, taxi..
managers, etc. drivers, having personality traits of
2. Neuroses of executives ( 11 Mental recklessness, etc.
C. Personal traits of leaders of workers hygiene of executives")
(paralleled with qualities of outstanding 3. Abuse of wage incentive plans,
executives?) rime study, etc.
4. General 11 Unpsychologic"
handling of situations in plant

C. Menral hygiene work of employer

D. I. Effect of group payment plans on D. Difficulties and misunderstandings C. Mental hygiene burdens forced on
relationships of workers to each other, due to different behavior patterns of community
especially to older and less efficient worker, foreman, employer, banker,
worker, etc. etc.
2. Effect of trade union benefit plans on
worker
3. Relarionships of workers with each
other in strikes and in unions from
standpoint of individual behavior

15
FIGURE 1.1 (continued)
III.
Illusmtive Problems Arising in lndusny
Affecting
THE WORKER IN RElATION TO HIS WORK
I. II. (Objective conditions of the job, penonal
Sciences Nearest Related to Studies FACfORS IN HUMAN BEHAVIOR condition of the worker, attirude towards
of Factots in Human Behavior With special reference to indusny task)

GROUP CULTURE (13)

Sociology AND A. Narure of group attitudes, prejudices, ere.
Ethnology ORGANIZATION affecting worker's attitude towards his
Cultural Anthropology (Combined physical, personal and work
History social circumstances-"environment") 1. Measurement of morale, etc.

Ethics
A. Beliefs, customs, traditions, structural or
institutional attirudes, national rraits, etc. B. The effect of different economic systems
(Religious, ethical, social) and industrial organization upon the wage
earner, including such elements as:
I. The industrial population and the labor
market
2. Mechanization, pace, routine work
3. Insecurity, unemployment, "pre..
senescence"
4. Competition and monopoly
B. Economic organization 5. The wage system and wage scales
I. Ownership and control of indusny 6. Insecurity, attitude towards older men
Economics 2. Technology of indusny 7. Personnel practices and labor turnover
3. Distribution of wealth 8. Employee ownetship of stock or control
4. General economic setting of plant

C. Obligation and righrs of worker

C. Political organization I. Compulsory labor, peonage, etc.
I. legislatures and commissions 2. Liabiliry for damages, individual
2. Laws and courts contract, etc.
Political Science 3. Protection of worker by provisions of
3. Police and constabularies
Jurisprudence law

Education

Science (Physical, Social) D. Intellectual organimtion D. Effect of school system on employee's

logic 1. Educational systems capacity to work, his attitude, etc.
Statistics 2. An, literature, etc.
(Experimental Research) 3. Purposeful research

Source: Social Science Research Council 1928.

16
 VI.
IV. v. Illustrative Problems Arising in Industry
Illustrative Problems Arising in Industry Illustrative Problems Arising in Industry Affecting
Affecting Affecting THE WORKER IN RELATION TO
THE WORKER IN RELATION TO HIS THE WORKER IN RELATION TO
THE PUBLIC
FELLOW•WORKER HIS EMPLOYER (Consumer, semi..public agencies, police,
(At his side, in his plant, in his union, in (Foreman, manager, owner, employing class, government, legislatures, courts,
his community or in the world at large) investor, capitalist, banker) commissions)

(14) (15) (16)

A. 1. Racial cohesion or conflict among A. I. Degree to which employers and workers A. Public opinion as a factor in labor
workers in industry are inftuenced by fixed ideas, conditions or labor disputes
2. Religious discriminadon Marxianism, memories of past abuses, l. Attitude of individual consumers
.3. Prejudices against "scab,., etc. uaditions, ethical considerations towards wage increases and other
demands
2. Attitude of masses towards child labor
amendment, etc.

8. I. Employers' organizations: structure, B. Effect of economic system on social

activities; open~shop drives, etc. problems
B. Group relationships in general, such as: 2. Absentee ownership, financial I. Unemployment and insecurity; long
I. Unionism: structure and activities domination of labor policies range planning of public works, etc.
a. Organization for group action 3. Employers' methcxls of administration 2. Crime, maladjustment, pauperism,
b. Crah versus industrial unions a. Technical and organizing ability citizenship
c. jurisdictional disputes b. Wages paid 3. leisure time activities of masses
d. lntta~union problems of factions, c. Manner of exercising authority 4. O>st of products, burden of taxes
leadership, etc. d. Policies towards older worker 5. Housing and transportation
e. Benefit features, recreation, etc. e. Personnel practices, etc. 6. Public personnel practices
f. Labor banks and other business f. Housing provisions
activities and their effect on union- g. Shop committees and employee stock
ism and on leaders and members plans C. Labor .legislation and administration
g. International organization of labor h. Labor turnover problems I. a. Restrictive
2. Relations of workers under employee 4. Problem of joint control of industry Sherman Act, Clayton Act
representation plans 5. Group relations with employer Individual contract
a. Collective bargaining and Compulsory arbitration
cooperation Regulation of immigration
b. Restrictive rules, spying system, etc. b. Protective and facilitative
c. Attitudes towards discipline, Mechanic's Lien, minimum wage
authority, scientific management, Factory regulation, workmen's
wage changes, etc. and whole compensation
problem of wage scales Social insurances
d. Strikes, violence, etc. Employment exchanges
2. Attitude of courts towards labor
C. I. Law of individual contracts a. The injunction
C. I. Rights of workers to organize unions 2. Laws affecting wage payments, etc. b. Social outlook of judges
2. Restrictions on boycotts 3. Relative strength in influencing 3. Industrial constabulary, police in
government strikes, etc.
4. Court decisions

D. I. Workers education D. I. Employers' educational work D. I. Educational system in relation to the

2. Union activities of cultural type 2. worker
3. Research work of unions 3. Employers' or joint research work 2.
3. Research agencies, public and semi-
public, investigating labor relations

17
 The Origins of Industrial Relations

in the workplace, and greater opportunities for the development of skills

and leadership capabilities.
Given these considerations, a composite description of the field as it
was perceived to exist in the 1920s might read as follows:
Industrial relations is the multidisciplinary study of the employment
relationship, with particular emphasis on the relations between em-
ployers and workers. It seeks to understand the forces of an economic,
social, political, psychological, and organizational nature that affect
the employment relationship; the goals, behaviors, practices, and or-
ganizations of employers and workers; the causes and consequences of
imperfections and maladjustments in the employment relationship that
adversely affect economic efficiency, workplace equity, and individual
well-being; and the practices and policies that can resolve these
problems.

I8
 2
THE ScHISM IN
INDUSTRIAL RELATIONS

T HE YEAR 1920 marks the birth year of industrial relations as a

professional field of study and practice, for it was then that a
distinct organizational entity devoted to the subject first appeared
in both academe (University of Wisconsin) and industry (the Industrial
Relations Association of America). What is more important than the
year of the founding of the field, however, is that both the IRAA and
the Department of Economics at Wisconsin were actively involved.
The majority of the members of the IRAA were practitioners who
were involved in general management or personnel work, although some
academics also belonged to the organization. These professionals were
especially interested in the new field of personnel management, a subject
a number of them wrote and lectured about. In contrast, the people
active in the industrial relations program at the University of Wisconsin
were institutional labor economists. Although their intellectual interests
covered nearly all aspects of the employment relationship, the primary
focus of their research and teaching was labor history, the practice of
collective bargaining, labor legislation, and the causes and consequences
of unemployment. Most advocated interventionist public policies to
protect and encourage collective bargaining, establish minimum wage
and employment standards, and provide wage earners and their families
with income security through social insurance programs.
What motivated these two disparate groups to develop a common
interest in industrial relations? One reason could have been a common
intellectual interest in advancing the state of knowledge about various

19
 Schism in Industrial Relations

aspects of the employment relationship. In fact, science-building was

of distinctly secondary importance. Rather, both groups were primarily
interested in problem-solving; that is, the resolution of labor problems
through improved methods of workplace organization and adminis-
tration, the promulgation of progressive public policies, and the thor-
ough application of ethics and moral values to the practice of
business. 1
Both the personnel professionals and academic economists had con-
siderable firsthand knowledge of prevailing business practices and work-
ing conditions in American industry and were well acquainted with the
substantial waste, inefficiency, human suffering, and conflict that this
system entailed. Their interest in industrial relations was thus animated
by a common desire to eliminate these evils through the discovery and
implementation of modem, progressive production and employment
methods.
While the two groups shared a common goal, it was also quickly
apparent that fundamental and irreconcilable differences existed be-
tween them concerning the most effective way to resolve labor prob-
lems and, in particular, the appropriate role to be played by trade
unions and collective bargaining. 2 Out of this disagreement was born
two factions or schools of thought that have competed for control
and dominance of the field of industrial relations from its earliest years
to the present day. Given that these schools of thought were focused
in the early 1920s on the study of personnel management and insti-
tutional labor economics, I have labeled them, respectively, the PM
School and the ILE School. Both schools expanded in later years to
include people from a variety of other academic disciplines and fields
of study and after World War II gradually metamorphosed into what
are today the HR (human resource) and IR (industrial relations) wings
of the field. 3 Despite the change in labels and affiliated fields of study,
the basic perspective of the two schools on the causes of labor problems
and the resolution thereof have remained remarkably similar over a
seventy-year period. 4
The remainder of this chapter describes the intellectual origins of
each school of thought and their early theoretical points of view on
the causes and resolution of labor problems. Later chapters describe
the evolution and development of these schools from the 1930s to
today.

20
 Schism in Industrial Relations

PERSONNEL MANAGEMENT ScHOOL

The practice and academic study of personnel management (or em~
ployment management as it was originally known) emerged at about the
same time as industrial relations. 5 The first university textbook in per-
sonnel, for example, by Ordway T ead and Henry C. Metcalf, was pub-
lished in 1920. Industrial relations was viewed as broader than personnel
management in that IR encompassed the entire employment relationship
and gave equal weight to the activities and organizations of both em-
ployers and employees, while PM focused largely on the management
side of the employment relationship and, in particular, on the practices
and procedures used to recruit, select, train, compensate, motivate, and
communicate with employees. Personnel management was therefore
seen as a subfield of industrial relations, just as labor relations (union-
management relations) was so conceived. 6
Given that personnel management represented only one part of the
subject area of industrial relations, its proponents had little intellectual
grounds for claiming sovereignty over it. Yet, as indicated earlier, the
impetus behind the rapid spread and popularization of industrial relations
after World War I had less to do with IR as an intellectual construct
than with IR as a means to achieve improved employer-employee re-
lations. The proponents and practitioners of PM believed they were the
principal claimants to industrial relations since, in their view, personnel
management offered the best means to achieve IR's end goal-improved
efficiency, equity, and human well-being in the workplace.
The manner in which PM was to achieve this goal is discussed later
in this chapter. This task requires, in tum, a brief consideration of the
evolution of thought and practice in personnel management in its for-
mative (pre-1930) years.

EVOLUTION OF PERSONNEL MANAGEMENT

Personnel management began in the World War I period as a fusion
of two separate movements in industry: scientific management and wel-
fare work (Lescohier 1935; Eilbirt 1959; Ling 1965; Wren 1987). The
field evolved further in the 1920s with the emergence of the human
relations movement (the practitioner, pre-Hawthorne version). A brief
consideration of these theoretical developments is necessary to identify
and appreciate the perspective of PM with respect to the causes and
solutions of labor problems.

21
 Schism in Industrial Relations

Scientific management was born shortly before the tum of the twen-
tieth century. Its most important proponent was Frederick Taylor, al-
though disciples such as Henry Gantt and Harrington Emerson also
made contributions (Hoxie 1915; Haber 1964). Taylor's focus of atten-
tion was on plant management. He argued that labor problems and the
adversarial relation between labor and capital arose from defective or-
ganization and improper methods of production and distribution in the
workplace. Production and distribution, he contended, are governed by
immutable natural laws that operate independently of human judgment.
The object of scientific management is to discover these laws and to
apply the "one best way" to selection, promotion, compensation, train-
ing, and production.
Taylor advocated using time and motion studies to determine the
most efficient method for performing each work task, piece-rate systems
of compensation to maximize employee work effort, and the selection
and training of employees based on a thorough investigation of their
talents and skills. Taylor also advocated changes in the organizational
structure of the business firm, such as replacing the single foreman in
charge of all aspects of production and personnel management in a given
department with several foremen, each of whom would be trained in
the knowledge and skills of a specific functional activity (e.g., produc-
tion, machine repair, and so on.) The end result of these reforms in
organization and methods would be the elimination of labor problems
and the adversarial relation between labor and capital. This would be
accomplished because all matters concerning production and distribution
would be made on the basis of natural law and the one best way, thus
eliminating disputes arising from errors and biases in human judgment.
Increased efficiency would result in higher profits and higher wages,
causing workers and employers to recognize that the employment re-
lationship involves a mutuality of interests, not a conflict of interests.
Industrial welfare work was introduced before the tum of the century,
grew in popularity up to the beginning of World War I, and then fell
into disfavor thereafter as an independent employment practice (Ling
1965:80). Welfare work consisted of a variety of activities, sponsored
and financed unilaterally by individual companies, the aim of which
was to improve the home and working life of the companies' employees.
Companies installed employee washrooms and lunchrooms, provided
the services of a company doctor or nurse, built various recreational

22
 Schism in Industrial Relations

facilities, offered financial assistance for home purchases, and sent com~
pany welfare representatives to employees' homes to check on the sick
or advise on nutritional and hygiene matters. In some cases companies
undertook welfare work out of philanthropic motives; others did it as a
way to forestall unionism or as a substitute for direct cash compensation.
Most often, however, the motive was the belief that welfare work was
"good business" because it helped foster loyalty and improved employees'
morale.
By the start of World War I a small minority of companies had
implemented at least some of the activities or principles associated with
scientific management and welfare work (Jacoby 1985). But in most of
these firms, to say nothing of the great majority of industry, the main
personnel functions of recruitment, hiring, compensation, training, and
discharge of employees still remained in the hands of the shop foremen
or other line management, and the foremen continued to use the drive
system as the principal mechanism for motivating employees. According
to the advocates of PM, the labor problems of the war era occurred
because the traditional system of personnel management was unscientific
and inhumane. The solution, in tum, was to take the personnel function
away from line management and vest it in a new staff function called
personnel management, where trained experts could devise and imple~
menta set of uniform, progressive policies and practices.
Some of these new personnel policies and practices were direct de~
scendants of scientific management. Thus, firms stripped the individual
foreman of the ability to hire at the plant gate and centralized this
activity in the personnel department, which developed formalized se~
lection procedures using written employment histories and aptitude tests.
Other practices were direct descendants of welfare work, such as pro~
viding services or benefits that fulfilled various personal and work~related
needs of employees. Thus, the duties of the company welfare worker,
such as management of the lunchroom or home visits, were also cen~
tralized in the personnel department and transformed from a sideline
activity smacking of heavy~handed paternalism to a modem business
practice that was an integral part of the management of labor.
Several other personnel principles and practices emerged in the 1920s
as reactions against some of the perceived shortcomings of scientific
management and welfare work (Milton 1960). The two most important
came under the headings "human relations" and "industrial democracy."

23
 Schism in Industrial Relations

By the start of World War I, several defects of Taylor's system of

scientific management had become apparent (Hoxie 1915). First, the
system tried to mold the worker to the needs of the job rather than
designing jobs to workers, leading critics to charge that the commodity
concept of labor had been replaced by a machine concept. The result
for employees was monotonous specialization and a loss of creativity and
skill. Second, employers had used scientific management as a ruse to
speed up work. Third, it had proved impossible to determine objectively
the one best way to determine compensation, promotion, and so forth.
Fourth, and finally, employees perceived scientific management to be
undemocratic since it was unilaterally implemented and administered
by management.
The basic cause of all of these shortcomings, critics argued, was that
Taylor and his colleagues had ignored the "human factor." Writing in
1922, Gordon S. Watkins (1922:476-77) states, "The old scientific
management failed because it was not founded upon a full appreciation
of the importance of the human factor. It was left for the new science
of personnel management to discover and evaluate the human elements
in production and distribution." The incorporation of the human factor
into scientific management soon became synonymous with the term
human relations.
Although the term human relations is widely credited as originating
with the Hawthorne experiments at the Western Electric Company in
the late 1920s and, more particularly, with the writings of Elton Mayo
and his colleagues at Harvard University, it was actually used quite
frequently a decade earlier by nonacademic writers. 7 In the preface to
the first edition of their personnel text, for example, T ead and Metcalf
(1920) state, "The purpose of this book is to set forth the principles
and the best prevailing practice in the field of the administration of
human relations in industry. "8 Not only was the term used widely before
Hawthorne, but many of the basic ideas of the Hawthorne version of
human relations can be found, albeit in somewhat impressionistic form,
in practitioner-authored articles and books of the early 1920s (see Wil-
liams 1920; Lewisohn 1926; Houser 1927). 9 For the most part, these
works were largely ignored by later academic writers (a point noted by
Wren 1985). 10
The essence of the pre-Hawthorne human relations perspective was
that through effective motivation, communication, and leadership in

24
 Schism in Industrial Relations

the workplace it is possible to create an organizational climate that

promotes a mutuality of interests between management and labor and
high levels ofjob satisfac~and productivity among employees. Fol~
lowing Taylor, the proponents of PM and human relations in the 1920s
maintained that the root cause of labor problems and an adversarial
relationship between labor and capital does not reside in any inherent
defects of capitalism but, rather, in the organizational and administrative
practices of management (Lewisohn 1926). 11 Labor problems are thus
a management problem and improved industrial relations is a manage~
ment responsibility. A common refrain of PM professionals was that
only good management practices could prevent labor problems, while
other proposed solutions to the labor problem (e.g., collective bargain~
ing) were at best palliatives (Bloomfield 1931). The advocates of PM
differed fundamentally from Taylor, however, regarding the best ap~
proach to eliminate the defects in management practice. Both groups
agreed that perfection in organization and administration required the
application of scientific principles to management, but Taylor looked
to the field of engineering for the solution while the advocates of human
relations looked to the new science of psychology. 12
According to the proponents of human relations, good industrial
relations depends on establishing a mutuality of interests between work~
ers and employers. Both groups, it was argued, want the same things
from work-maximum satisfaction and financial return-but they per~
ceive themselves in conflict in the attainment of these goals (Filene
1919). The key to successful industrial relations, therefore, is to operate
the firm in such a way that attainment of the organization's goals si~
multaneously fulfills the goals of workers, thereby creating a sense of
partnership and an environment conducive to cooperation, trust, loy~
alty, and hard work (Follett 1925; Tead 1929, 1931). 13 The needs,
aspirations, and attitudes of workers, however, are unknowable a priori
and can be discovered only through the science of psychology. Hence,
the first step in successful PM is to use psychological investigation to
discover what workers want from work and the second step is to operate
the organization and design its personnel practices in a way that is
congruent with these needs.
During the 1920s there was an outpouring of books and articles by
psychologists, business practitioners, and consultants on "what the
worker wants" (Williams 1920; Thorndike 1922; Tead 1929). Typically,

25
 Schism in Industrial Relations

what the worker was thought to want was economic security, respect
and fair dealing from supervisors, opportunity for advancement, and
effective leadership from the firm's managers. Although much of this
work was based on relatively unscientific methods, it nevertheless de,
veloped several themes that later proved quite important in PM.
One such theme concerned economic versus noneconomic determi,
nants of employee work behavior. Classical economics and scientific
management both used a model of "economic man" in that they pre,
sumed employees were motivated primarily by economic considera,
tions. 14 Management writers in the 1920s took the first step in replacing
economic man with "social man." Numerous writers {e.g., Thorndike
1922; Lewisohn 1926) argued that workers value such nonpecuniary
rewards as status, justice, security, and advancement. Ordway Tead
(1929:132) went one step further and, in anticipation of later theories
of motivation by Abraham H. Maslow and Frederick Herzberg, argued
that economic needs have to be met first but that worker loyalty and
satisfaction ultimately depend on the fulfillment of such noneconomic
needs as security, justice, and self,worth. The displacement of economic
man by social man in the PM literature was important because it provided
an intellectual justification for the abandonment of drive methods of
motivation that relied on fear and intimidation and the adoption of
positive employment methods (e.g., supervisor training, employment
security, profit sharing) that not only encouraged hard work by linking
personal gain with corporate gain but also fostered an atmosphere of
fair treatment and personal growth.
The role of managerial leadership also became an important theme.
Writers on PM noted that corporate managers were prone to devoting
most of their attention to the "business" side of the firm and to neglecting
the "people" side (e.g., firms had created staff departments for the
finance, production, and accounting functions long before personnel
departments). The proponents of PM claimed that the most important
determinant of profitability was the way firms treated their employees
(Lewisohn 1926; Spates 1937; Hicks 1941). It was crucial, therefore,
for both improved industrial relations and firm performance that· man,
agers take a progressive, forward,looking approach to labor. Toward that
end, PM treatises of the 1920s expounded the benefits to managers and
their organizations of progressive, humane personnel policies and iden,
tified the traits of successful leadership so that managers might more

26
 Schism in Industrial Relations

effectively deal with employees and earn their loyalty and support (Craig
and Charters 1925). The job of the ·manager had changed from com,
manding employees to perform certain tasks to enlisting their cooper,
ation, something that could only be done successfully with good
interpersonal skills and a sound knowledge of what motivates work effort.
The emphasis on leadership thus reinforced the shift of attention in PM
away from earlier views of labor as a commodity or a machine to a
conception of workers as human beings who, with the right management
practices and work environment, could become satisfied, productive
members of the company team. This emphasis on the role of managerial
leadership also imparted a unilateral, paternalistic tone to PM since it
tended to locate all responsibility for improved industrial relations in
the hands of management.
The organizational goals of the firm were yet another area of impor,
tance. Proponents of PM argued that a congruence of interests between
the organization and its employees could be obtained only if the firm
pursued goals that were salient to workers (Tead 1931:33-36; Hicks
1941:167-69). Strict adherence to a goal of profit maximization was
likely to perpetuate an environment of conflict and mistrust because it
emphasized the role of labor as a cost of production and subordinated
employees' interests to those of absentee shareholders. Successful in,
dustrial relations required, therefore, that managers pursue multiple goals
that would satisfy the needs of various stakeholders, including workers.
Although this strategy might reduce profits in the short run, the pro,
ponents of PM argued that it increased profits in the long run by leading
to reduced absenteeism, greater work effort, and less conflict.
The human relations perspective provided one of the fundamental
pillars of thought in PM in the 1920s; the concept of industrial de,
mocracy provided another. The term industrial democracy had been pop,
ularized by Sidney and Beatrice Webb of Great Britain in their landmark
book Industrial Democracy (1897). The Webbs were Fabian socialists and
ardent supporters of trade unions. They argued at length that the tra,
ditional master,servant relationship in industry was incompatible with
democratic principles because workers had neither a formal voice in the
determination of wages and other terms and conditions of employment
nor protection from arbitrary and/or discriminatory decisions of man,
agement with regard to discipline, discharge, and other such matters.
From the Webbs' point of view, trade unions were the major instrument

27
 Schism in Industrial Relations

by which to introduce democracy into industry because they provided

workers with an independent source of representation vis-a-vis the
employer.
Proponents of PM in the 1920s were in most cases steadfastly opposed
to labor unions and collective bargaining in practice, if not in principle.
Some PM writers admitted that labor unions were justified in situations
where the firm operated in an autocratic, exploitative manner (Hicks
1941:6 7-77). Some also allowed that labor unions could play a con-
structive role in labor relations and that firms might actually benefit
from having a union organize its workers (Tead and Metcalf 1920:446-
80). Most PM writers, however, remained steadfastly opposed to labor
unions and collective bargaining in practice (McCone 1920; Catchings
1923; Follett 1926). As they saw it, union leaders were driven to promote
adversarialism and conflict to justify the unions' existence and thus
unions were inimical to achieving the desired mutuality of interests
between workers and employers. The proponents of PM also opposed
unions on efficiency grounds because they claimed they foisted numerous
restrictive practices on management, forced employers to pay inflated
wages, disrupted production with strikes and slowdowns, and protected
loafers and malcontents from dismissal. Finally, the proponents of PM
claimed that unions were the enemy of true industrial democracy because
they stifled individualism and were run by autocratic union bosses who
were largely unaccountable to the membership.
While the advocates of PM opposed labor unions and collective bar-
gaining, they believed that alternative forms of industrial democracy or
"joint representation" could materially advance the interests of both
employers and workers (Rockefeller 1923; Lewisohn 1926; Tead and
Metcalf 1933; Holliday 1934). The practice of human relations, they
said, could not create a mutuality of interests as long as the power and
status of workers were so clearly inferior to those of managers. Joint
representation was thus seen as a way to equalize power in the organi-
zation and foster constructive employee attitudes such as loyalty, com-
mitment, and initiative. It also contributed to greater efficiency in
production because it promoted greater employee morale and work effort,
provided an escape valve for frustration and discontent, and increased
the flow of information to upper-level management concerning condi-
tions and problems on the shop floor. Further, joint representation
fostered greater employer-employee cooperation by forcing management

28
 Schism in Industrial Relations

to give stronger consideration to the interests and concerns of workers.

A final benefit was that it could possibly forestall unionization.
Given these many benefits, it became an accepted axiom of progressive
management thought in the 1920s that an employee representation plan
was an essential ingredient of good industrial relations. Although the
structure and function of nonunion plans varied, the basic features were
similar: the plans covered only the employees of a particular plant or
firm; workers elected representatives who met with company officials to
discuss issues of mutual concern; most plans mandated only that man-
agement meet and confer with the employee representatives; the right
to strike was prohibited; and the company paid the costs associated with
operation and administration of the plan (Carpenter 1926; Tead and
Metcalf 1933; Nelson 1982).
In summary, the proponents of PM in the 1920s had worked out a
coherent though somewhat heuristic explanation for the cause of labor
problems and the best approach to resolving them. Their major goal
was to achieve a congruence of interests between employers and workers,
for out of such a congruence would flow both greater efficiency and
employee happiness. The achievement of improved industrial relations
required both the scientific application of engineering and management
principles to the organization and administration of work and the in-
corporation of human relations and industrial democracy into the man-
agement and utilization oflabor. Given the focus on integrating scientific
principles of management with the practice of human relations, PM
necessarily drew most of its intellectual inspiration from the fields of
engineering, management, and psychology (industrial sociology was not
yet a recognized academic field) and approached the study of industrial
relations from an internal or intraorganizational point of view centered
on the interaction between individual workers and managers within the
plant. 15 Ideologically, PM was progressive in its approach to the man-
agement of people (relative to prevailing practices of the day}, conser-
vative with respect to property rights and government regulation of
business, and hostile to labor unions.

INSTITUTIONAL LABOR EcoNoMics ScHOOL

Like personnel management, institutional labor economics did not
cover all aspects of the employment relationship in its intellectual do-
main. Rather, the emphasis of ILE was on the impact of organizational

29
 Schism in Industrial Relations

or "institutional" forces (e. g., unions, government, family, social cus-

tom, law) on the employment relationship and the operation of labor
markets (Commons 1934b). But, like the proponents of PM, the ad-
herents of ILE believed they had the most accurate diagnosis of the
causes of labor problems and the most efficacious solution to these
problems.

ORIGINS AND THEORETICAL PERSPECTIVE

It is useful to discuss briefly the origins and theoretical perspective of
institutional labor economics before embarking on a more detailed anal-
ysis of the point of view of ILE concerning labor problems and their
resolution.
Institutional economics (IE) was born in America shortly before the
tum of the twentieth century. Its intellectual roots came primarily from
the German historical school of economics, although the writings of
Karl Marx and the Webbs also exerted some influence (Dorfman 1959,
1963; McNulty 1980; Jacoby 1990). Thorstein Veblen, John R. Com-
mons, and Wesley C. Mitchell are generally credited as the founders of
IE. Commons, however, had by far the greatest impact in the area of
labor, and, indeed, his point of view is sufficiently distinct from that of
the others that it is useful to label his branch of the field as institutional
labor economics.
The economics that dominated American thought in the latter part
of the nineteenth century was based on the writings of various classical
and neoclassical economists from Great Britain, including Adam Smith
David Ricardo, John Stuart Mill, and Alfred Marshall (Ross 1991).
Adam Smith's The Wealth of Nations (1776) and later classical and
neoclassical writings on economics worked out in some detail the eco-
nomic and social virtues of free and unfettered competition in product
and labor markets. A system of free exchange, Smith claimed, provides
maximum individual liberty for employers and employees, reconciles
conflicting interests into a harmony of interests, organizes production
in the most efficient manner, and results in a just distribution of income
to labor and capital. A free labor market maximizes the liberty of em-
ployees, for example, because it allows them the greatest choice of their
employer, occupation, and location of work and permits the worker to
quit one firm and seek a job at another whenever the terms and con-

30
 Schism in Industrial Relations

ditions of employment are judged to be unsatisfactory. Likewise, al-

though employers and employees are nominally rivals in the labor
market, the process of competition and free exchange leads them to
seek out and voluntarily consummate mutually advantageous trades,
leading to a "win-win" outcome and a harmony of interests in the long
run. Competitive markets also result in the most efficient production of
goods and services since prices (including wages, interest rates, and so
on) accurately reflect the opportunity cost of scarce resources and the
profit motive, combined with competition, motivates firms to employ
more of these resources only as long as the additional gain in economic
value to society from the goods and services produced is greater than
the economic cost. A corollary of this point is that competition also
leads to full employment in the labor market since wage rates will rise
or fall until the demand for labor equals the supply. Finally, a competitive
market system also gives rise to a just distribution of income in that
employees are paid a wage equal to their contribution to production
(implying zero exploitation of labor).
Disenchantment among American economists with the classical and
neoclassical school emerged in the 1870s and gradually grew into a full-
scale rebellion under the label of institutional economics (Dorfman 1959;
McNulty 1980). Leading the rebellion was a group of graduate students
that included Richard Ely, John Bates Clark, Henry Carter Adams,
Simon Patten, and Edwin Seligman, who went to Germany in the mid-
1870s to study under several prominent economists who were members
of the German historical school (Ely 1938). These economists heavily
criticized the classical and neoclassical theory of the British and Amer·
icans because, in their view, it represented a sterile exercise in deductive
logic based on purported "natural laws" that were either conjectural or
widely inconsistent with observed facts. In its place, the Germans ad-
vocated that economics be constructed as an inductive science in which
assumptions and axioms would be adduced from the careful historical
study of economic behavior. Furthermore, they placed much greater
emphasis on the positive effects of state regulation and management of
markets and on the constructive role labor unions could play in im-
proving the conditions of labor.
When the Americans returned to their home country, they set out
to develop a new, or at least greatly modified, economics that borrowed

31
 Schism in Industrial Relations

heavily from the teachings of their German professors. 16 The result, as

later refined and developed by Veblen, Commons, and Mitchell, was
institutional economics.
Institutional economics in the 1920s contained several core propo·
sitions that distinguished it from the classical and neoclassical theory
(Dorfman 1959; Dickman 1987; Ross 1991). The proponents of IE
maintained that the crucial defect in the classical and neoclassical theory
was that it presumed that product and labor markets were highly com-
petitive (consumers and workers faced numerous alternative sources of
products and jobs). Based on empirical and historical research, the
institutionalists concluded that in reality product and labor markets were
very imperfect and that business firms thus' possessed some monopoly
power with which to exploit consumers and workers.
Given the unequal plane of competition, institutionalists argued that
free markets and laissez-faire were inimical to individual liberty and
created a conflict of interests. Liberty, the institutionalists said, meant
the ability to choose one's employer freely and to quit working for that
employer when one desired. Free markets, however, imposed a tyranny
on workers because the lack of alternative employment (because there
were few firms in the local area and/or substantial unemployment) and
the costs associated with labor mobility (e. g., loss of seniority rights,
loss of income until a new job is found) coerced workers to accept wages
and working conditions that they would not voluntarily choose given
other options. Likewise, conflict is inevitable when economic circum-
stances allow the employer to take unfair advantage of workers.
The institutionalists also argued that a free market system was not
only inimical to individual liberty but detrimental to the achievement
of economic efficiency and growth. The low wages and high prices
associated with business monopoly result in inadequate income and
consumption spending and a consequent tendency to stagnation and
unemployment, for example, while the volatility of wages and prices in
a competitive market exacerbate the economy's boom and bust cycle.

CAUSES OF LABOR PROBLEMS

Ely (1886: 100) claimed that three "peculiarities" of labor accounted
for the worker's disadvantageous position in the labor market: labor's
inequality of bargaining power, management's authoritarianism in in-

32
 Schism in Industrial Relations

dustry, and the workers' economic insecurity. Later institutional writers

amplified on these themes. 17 Each is briefly considered below.
A central tenet of institutional thought is that many workers suffer
from an inequality of bargaining power under a nonunion system of
individual bargaining (Webb and Webb 1897; Commons and Andrews
1916; S. Perlman 1928; Slichter 1931). The labor problems that result
include exploitative wages, substandard working conditions, and labor
unrest and conflict. The essence of the idea is that most labor markets
contain imperfections that bias the wage determination process against
workers. In a perfectly competitive labor market, the individual worker
and employer would approach wage bargaining with an equality of power
since the employer could not force the worker to accept less than the
going rate given the numerous other job opportunities available and the
worker could not force the employer to pay more than the going rate
given the employer's ability to find numerous replacements. Labor would
thus be paid the competitive wage, which would be equal to its con-
tribution to production.
The case studies and investigative surveys conducted by the institu·
tionalists led them to conclude that workers in many labor markets were
at a distinct disadvantage in bargaining power vis-a-vis employers. They
identified several reasons for this disadvantage, including the presence
of substantial involuntary unemployment in normal times; conditions
of monopsony and oligopsony (only one or several employers} in the
labor market; collusive agreements among employers (often enforced
through employers' associations); discrimination against minorities, im-
migrants, and women; and restrictions on worker mobility because of
the loss of seniority or other rights (see Kaufman 1989a; 1991a}. The
effect of all these conditions was that employers were able to provide
less than competitive wages and working conditions because workers
were forced into a "take it or leave it" situation by the lack of alternative
job opportunities and discriminatory or collusive practices. 18
The second cause of workers' employment problems that Ely identified
was management's authoritarianism in industry. Although workers had
won full political rights in the nineteenth century, the employer-
employee relationship remained of the master-servant type. This situ-
ation created an inequality of political power and due process inside the
plant that paralleled the economic inequality of power in the external

33
 Schism in Industrial Relations

labor market. Ely identified this lack of industrial democracy as causing

several labor problems, including low employee morale and work effort,
frequent turnover, and strikes and other forms of conflict.
The third cause of workers' problems that Ely identified was economic
insecurity, a theme later stressed by Commons (1926:263-72) and Selig
Perlman (1928). As long as a person's labor is regarded as a commodity,
Ely claimed, the worker's livelihood is tied to the vagaries of the labor
market, the goodwill of the employer, and the uncertain occurrence of
sickness and accidents. The worker's existence is thus filled with daily
stress and anxiety, for his ability to earn an income to feed, clothe, and
shelter his family are dependent on events largely outside his control.
In reaction, workers take various steps to protect themselves, such as
restricting their rate of output and the employer's ability to hire non-
union workers, that are harmful to efficiency and act as catalysts for
conflict with employers.
From the diagnosis of these economic and social ills flowed the so-
lutions. The solution to labor's inequality of bargaining power, the
institutionalists said, was to eliminate the problem by leveling the plane
of competition. This was to be accomplished by what the Webbs (1897)
called "the Device of the Common Rule." The Webbs noted that no
matter how well intentioned an employer might be, competitive pres-
sures during a recession, or from rivals whose labor costs are somehow
lower (e.g., because they use child labor), inevitably force the firm to
cut wages, lengthen hours, and speed up the work. To eliminate the
downward pressure on wages and labor standards, the Webbs argued, it
was necessary to place a floor under labor standards below which no
employer could go. This "common rule" could be accomplished by either
"the Method of Collective Bargaining" or "the Method of Legal En-
actment" (i.e., protective labor legislation).
According to the Webbs, collective bargaining stabilizes wages and
working conditions in two ways: first, the union acts as a countervailing
power that offsets the weakness of workers in a system of individual
bargaining and, second, by organizing all the employers in the product
market and establishing uniform labor costs across them, the union takes
wages out of competition. Government legislation such as a minimum
wage law or a maximum hours law performs much the same function.
The Webbs advocated setting the "common rule" at the level that would

34
 Schism in Industrial Relations

have occurred had the labor market been competitive and at full em~
ployment, thus leading to an increase in both efficiency and equity.
The solution to management authoritarianism, the institutionalists
claimed, was industrial democracy, or joint determination of the terms
and conditions of employment and the provision of due process in the
settlement of disputes over rights. The institutionalists regarded non~
union employee representation plans as a step forward, particularly if
they provided employees with independent decision~making power and
protection from arbitrary discipline and discharge. The fundamental
weakness of such plans, however, was that they were created by a
unilateral act of management and just as easily could be abolished or
ignored (Douglas 1921). For this reason the institutionalists advocated
trade unions as a complement to employee representation plans and
viewed unions as the long~term solution to industrial democracy. Union
bargaining power, they said, provided workers with both voice and
protection that was independent of the goodwill of the employer (Com~
mons 1920; Leiserson 1923, 1929).
Eliminating the insecurity of the worker involved both micro~ and
macro~level changes (Commons 1921, 1926:263-72). At the plant
level, it required a philosophical commitment by management to provide
employment security; improved production and marketing methods to
reduce seasonal and cyclical fluctuations in employment; and a system
of employee representation to provide protection against arbitrary dis~
missal and discipline. At the economywide level, it required stabilization
of the currency by the Federal Reserve Bank, a negotiated or legislated
floor under wages and working conditions so that recessions and depres~
sion would not lead to a general liquidation of labor standards, and the
creation of social insurance programs (e.g., workmens' compensation,
unemployment compensation, social security) that would provide both
tax incentives to firms to regularize employment and income support to
workers who for reasons outside their control were unable to work. 19

POINTS OF AGREEMENT AND DISAGREEMENT

BETWEEN THE ScHooLs

POINTS OF AGREEMENT
The overarching issue that united both the PM and the ILE schools
was the need for employment reform. The traditional way of managing

35
 Schism in Industrial Relations

workers in American industry resulted in unacceptable waste, ineffi-

ciency, and human suffering. Progressives such as John R. Commons
and Clarence J. Hicks sought to reduce and then eliminate these con-
ditions. Both men, and the schools of thought they represented, also
had similar views on the essential elements of reform.
Both agreed on the need to apply scientific principles to the orga-
nization of production and the management of work. Scientific man-
agement was not the sole answer to the elimination of labor problems,
as Frederick Taylor had believed, but it was an important part of the
solution. Both men also recognized the importance of the "human fac-
tor" in structuring and managing work. The source of many labor prob-
lems was the tendency for managers to treat employees as commodities,
when in fact these "commodities" came to the workplace with a full
range of human emotions and needs. Thus, the proponents of both the
PM and the ILE schools advocated new personnel policies and practices
to ensure employment security, respect on the job, and fair treatment.
Another area of agreement concerned the importance of replacing the
autocratic, master-servant type of employer-employee relationship with
one that provided employees with representation rights and due process
in the workplace. Finally, both men agreed on the importance and
desirability of maintaining the basic institutions of capitalism, including
private property and free labor markets.

POINTS OF DISAGREEMENT
In general, the proponents of the ILE school were academically trained
economists, while the early writers in the PM school tended to come
from the ranks of management in industry (as did many of the teachers
of personnel courses in business schools of the 1920s). The two groups
inevitably looked at the causes and solutions of labor problems from
different perspectives. 20 It was evident to both that the business orga-
nization was the place to begin the investigation of labor problems, for
that was where the inefficiency in production, the low work effort, and
the conflict occurred. When it came to identifying the underlying causes
of the problems, however, the two sides diverged. The economists
tended to give far greater weight to the external economic, legal, and
technological environment, such as business cycles, labor market im-
perfections, and the lt!gal rights and protections given to employers and
employees. In contrast, the management practitioners tended to focus

36
 Schism in Industrial Relations

on the internal organizational, social, and psychological environment

of the firm, including managerial leadership, methods of compensation,
and other motivational devices, and on the organizational climate en,
gendered by management (e.g., degree of trust and goodwill between
the firm and its employees). Out of this difference grew some funda-
mental disagreements about the causes of labor problems and their
resolution.
One such disagreement concerned whether a conflict of interests is
inherent to the employment relationship. As noted earlier, proponents
of the PM school readily admitted as an empirical fact that conflict is
rife in many employment relationships. They denied, however, that
conflict is inevitable. Hicks (1941 :65-79), for example, identified three
types of employment relationships: "autocratic," "two antagonistic par-
ties," and "unity of interests." Because the employment relationship is
structured as a zero-sum game (what one side gains is at the expense of
the other), the first two relationships (the traditional master-servant
relationship and the union-company relationship) inevitably exhibit a
large degree of adversarialism. Using human relations and industrial
democracy, however, one could achieve the third type of employment
relationship. In this case, the employer and the employees perceive
themselves to be partners in a common enterprise, giving rise to a
mutuality of interests and a sense of shared purpose. Because organi-
zational success benefits both sides, the employment relationship be-
comes a positive-sum game, motivating employees to work diligently for
the firm's success.
The institutionalists had a substantially different view. As they saw
it, the employment relationship has a fundamentally mixed-motive na-
ture in that it contains significant elements of both cooperation and
conflict. An incentive for cooperation exists, for without the partici-
pation of both parties to the employment relationship, the firm will not
be a viable concern and neither profit nor wages will be earned. Thus,
outside limits exist with respect to the level of the wage rate, working
conditions, and work effort that the workers and firm wish to obtain.
Within these limits, however, an adversarial relationship exists. One
dimension of this relationship is economic in that the additional profit
earned by the employer from lower wages, a reduced expenditure on
working conditions, or a greater pace of work necessarily comes at the
expense of workers, and vice versa (Hansen 1922). Another dimension

37
 Schism in Industrial Relations

of this relationship is social in nature and involves the frictions and

resentments that inevitably arise between order givers (management)
and order takers (employees) (see Douglas 1921). While employers may
attempt to reduce the adversarialism inherent in the employment re,
lationship through human relations practices, a certain core amount of
conflict always exists in that the employer's control of the workplace
and drive for greater efficiency and profit necessarily collide with the
workers' desire for independence from managerial subordination, em,
ployment security, and a higher standard of living.
These alternative views on the adversarial nature of the employment
relationship gave rise to alternative views of the efficacy of conflict in
the employment relationship. From the point of view of the institu,
tionalists, a certain amount of conflict is a normal by,product of the
employment relationship and, indeed, frequently plays a constructive
role to the extent that it vents repressed frustrations, resentments, and
grievances. Good industrial relations, therefore, is not synonymous with
an absence of conflict, for often this indicates complete domination of
the relationship by the employer. Rather, good industrial relations re,
quires equalizing the bargaining power of labor and capital both inside
and outside the plant and letting them voluntarily negotiate a mutually
satisfactory outcome. 21 Thus, the watchword of the institutionalists is
compromise.
From a PM point of view, however, conflict of an ongoing, substantive
nature is undesirable because it is destructive of the trust and shared
purpose that are essential to unlocking employee commitment and hard
work. The presence of conflict is thus a signal that the management
and organization of work continue to suffer from fundamental defects
and that additional management action is needed. The end goal, there,
fore, should be the integration of employer and employee interests and
the elimination of conflict (Follett 1926; Hicks 1941). Rather than
compromise, which the PM school sees as doing nothing to remedy the
underlying sources of conflict, the watchword of the PM school is co,
operation.
The disagreement between the PM and the ILE schools then moved
to the issue of how best to induce firms to adopt the necessary changes
in management practices required for harmonious relations. Commons
(1926:263) estimated that between 10 and 25 percent of firms in the
1920s used "best,practice" labor relations policies, a figure the propo,

38
 Schism in Industrial Relations

nents of PM did not dispute. The issue for employment reform, then,
was how to get the other 75 to 90 percent (the laggards) up to the same
level of accomplishment.
The basic approach favored by the proponents of the PM school was
to use education, persuasion, and patience. As noted earlier, they be-
lieved that a mutuality of interests could be attained by adopting pro-
gressive personnel policies, particularly human relations and industrial
democracy. The challenge was to induce firms to adopt these practices.
The PM school believed a two-prong strategy would work best (Milton
1960:129-40). The first prong involved an appeal to the employer's
sense of ethics and Christian duty; that is, convincing the laggards that
they had a moral responsibility to improve their treatment of employees.
The second prong involved business education; that is, convincing em-
ployers that improved management practices were also good for their
bottom line.
The early proponents of PM believed that employers would adopt
progressive personnel practices if they perceived the benefits to be greater
than the costs. Thus, a fundamental axiom of PM is that progressive
personnel practices are not only right from a moral and ethical point
of view but also more than pay for themselves in the form of increased
profit (Tead and Metcalf 1920:9). The problem is that many employers
have a difficult time seeing the validity of this proposition because, on
the one hand, the costs of improved personnel practices tend to be
readily quantifiable and incurred in the short run (e.g., salaries of per-
sonnel staff, additional payroll costs associated with employment se-
curity), whereas the benefits are often difficult to measure and often do
not become evident until well into the future (e.g., increased produc-
tivity through higher morale, lower chances of unionization). The result
is that many employers mistakenly believe that good labor relations
policies are a "luxury" that only profitable firms can afford and thus do
not undertake them. The proponents of PM believed that the only way
to counteract this view was through education, both on the new tech-
niques of personnel administration (e.g., employment tests, employee
representation plans) and on their benefits to the firm (Kennedy 1920;
Tead and Metcalf 1920:15-16; Houser 1927:202-18).
From the ILE point of view, these positions were not so much wrong
as seriously incomplete. Commons, for example, agreed with the con-
tention that progressive personnel policies could reduce labor problems

39
 Schism in Industrial Relations

and that educational activities could make a significant contribution to

promoting the adoption of such policies. The major theme of his book
Industrial GoodwiU (1919), for example, was that the cultivation of em,
ployee goodwill paid off for business firms. From his perspective, it was
a vain hope, however, to believe that education and moral suasion could
ever induce the great majority of firms to adopt best,practice personnel
policies voluntarily.
The critical flaws in the PM point of view were twofold. The first
was that human relations and industrial democracy required managers
to relinquish a portion of their unilateral power and control, an idea
that was anathema to many managers regardless of its salutary effect on
profits. The second flaw was that the PM view did not sufficiently
recognize that the incentive for firms to adopt progressive personnel
policies was contingent on the state of the economy. 22
According to Commons (1921), full employment, not education, is
the most effective way to promote the adoption of progressive personnel
practices in industry. The reason is that full employment creates con,
ditions in the labor market and workplace (e.g., labor shortages, labor
turnover, reduced work effort, more strikes} that make it plainly in the
self,interest of employers to practice better labor relations. In effect, he
says, only when labor is scarce will employers be induced to treat labor
as a human resource rather than as a commodity. When the economy
operates at less than full employment, the abundance of labor removes
much of the incentive on management to adopt progressive measures
since it is easy to replace disgruntled, uncooperative, or injured em,
ployees with other willing hands. Further, the competitive pressure in
a slack market to cut costs forces first financially weaker firms and then
their stronger competitors to cut labor compensation and increase work
effort (see Douglas 1921, 1922). Thus, from the ILE perspective, the
fundamental source of labor problems is not at the individual plant in
the form of inhumane and/or unscientific management practices per se
but, rather, at the level of industry and the economy, where involuntary
unemployment and idle plant capacity make such policies both profitable
and necessary (Commons 1921:4, 1934a:190). It follows, in tum, that
the most effective means to spur the adoption of progressive personnel
policies is to pursue a full,employment monetary policy by the Federal
Reserve Bank. 23
Another source of disagreement between the PM and the ILE schools

40
 Schism in Industrial Relations

concerned the role of labor unions and collective bargaining in pro-

moting improved industrial relations. As noted earlier, most PM ad-
vocates held labor unions in low regard. While they were prepared to
admit that workers are all too often driven to seek a union by autocratic,
exploitative employers, they thought unions are not only incapable of
solving the underlying problem (poor management) but often saddle the
firm and workers with restrictive work rules, inflated wage demands,
strikes, and internal political intrigues. More important, nearly all PM
advocates objected strongly to the demand of unions for the union or
closed shop, on the grounds that no person should be denied employment
on account of his or her union status. They also believed that labor
unions are run by outsiders whose self-interest is served by fomenting
conflict, given that workers desire a union and pay union dues only if
they feel dissatisfied with the terms and conditions of employment
(Catchings 1923:486).
Proponents of the ILE school took a different view of unions. Some
firms, they admitted, are so well managed and pay sufficiently high
wages that the workers have no need for a union. The personnel
practices of the majority of firms, however, lag behind, either because
of poor management or low profits. For this group of firms, unions
have a constructive role to play that should be encouraged by public
policy. 24 It is true that labor unions typically increase the labor costs
of employers, both directly through wage demands and indirectly
through restrictive work practices, strikes, and other such practices.
While employers understandably resist unions for these reasons, the
ILE school maintained that from a social point of view the benefits
of having unions clearly exceed the costs. Wage gains secured by
unions, for example, are socially useful because they eliminate the low
wages forced on workers by labor's inequality of bargaining power;
union wage gains motivate management to operate the firm more
efficiently, leading to offsetting gains in productivity (the "shock"
effect); and union wage gains bolster household income and help
promote aggregate demand and full employment.
With regard to restrictive work practices, the institutionalists argued
that the obvious costs to employers must be weighed against the benefits
to workers and society. 25 Trade unions, they said, are inherently
restrictive in nature since their purpose is to prevent certain employ-
ment practices that the pressures of competition force employers to

41
 Schism in Industrial Relations

adopt. Many of these practices (e. g., twelve~ hour workdays, excessive
line speed, lack of elementary safety equipment) are clearly injurious
to both workers and society and their elimination through collective
bargaining is thus to be desired. While individual firms may be put
at a competitive disadvantage to the extent that restrictive union prac~
tices raise labor costs only at those firms, the solution to this problem
is best met by taking labor costs out of competition by organizing all
firms in the relevant product market and imposing common labor stan~
dards on them.
The institutionalists also favored labor unions as the primary vehicle
to achieve industrial democracy. Company unions, works councils, and
other employer-sponsored forms of employee representation do not pro~
vide industrial democracy in the true sense of the term, since they are
created by management and give workers little or no independent power
to negotiate improved terms of employment or protection from arbitrary
management decisions on discipline and discharge. True democracy
means that decisions are reached only with the consent of the governed,
implying that workers must be able to elect representatives of their own
choosing, engage in collective bargaining over wages and other con~
ditions of employment, and go on strike if an agreement cannot be
reached. Industrial democracy also implies that unions have a legitimate
right to demand the union shop or closed shop, for, just as all citizens
in the nation are bound to abide by laws adopted by the majority, so
too should all employees belong to and support the union if it has been
freely chosen by a majority in the plant.
Finally, institutionalists were strong advocates of economic and po~
litical "pluralism" and saw unions as essential parts of such a system.
Business firms, they thought, had a power advantage over workers and
consumers because the latter were unorganized and could not effectively
represent their interests. The solution was a pluralistic network of or~
ganized interest groups, such as labor unions, political parties, church
groups, civic associations, and so on, each of which would represent
their respective constituencies. This conception of society led the in~
stitutionalists to stress a "tripartite" approach to the resolution of labor
disputes, in which tripartite meant collaboration, consultation, and
compromise between representatives of labor, management, and the
public. 26
For all of these reasons, the proponents of the ILE school saw unions

42
 Schism in Industrial Relations

as a desirable, albeit imperfect, instrument to promote improved in-

dustrial relations. In contrast, the advocates of the PM school saw unions
as an impediment to efficiency and as an abridgement to individual
freedom, and, accordingly, they resisted them strongly. As shall become
clear in succeeding chapters, the split between the PM and the ILE
schools over the issue of unionism would prove to be an enduring feature
of the field of industrial relations and one with far-reaching con-
sequences.

43
 3
INDUSTRIAL RELATIONS IN THE
INTERWAR YEARS

T HE DEVELOPMENT of industrial relations in the years between

the world wars is one of the most interesting yet least explored
chapters in the history of the field. Industrial relations made
slow but perceptible progress over this twenty-year period in carving
out an identity as a distinct subject area of teaching and research.
Most noteworthy in this regard was the establishment at six universities
of IR units or sections dedicated to the promotion of research and,
to a lesser degree, teaching in industrial relations. Equally important,
the field continued to attract the active participation of persons from
both the ILE and PM wings. Although the two sides looked at the
causes of labor problems from different perspectives and promoted
different policy programs for resolving these problems, as an intellectual
concept and academic field of study, industrial relations possessed a
sufficient degree of elasticity during this period to accommodate these
divergent views and interests. As we shall see, this was not to be the
case two decades later.

EsTABLISHMENT OF INDUSTRIAL RELATIONS UNITS

The first independent unit at an American university dedicated
mainly, if not solely, to the study of industrial relations was the Industrial
Research Department, established in 1921, in the Wharton School of
Commerce and Finance of the University of Pennsylvania. (The de-
partment's name was changed in 1953 to the Industrial Research Unit.)
The first director of the department, Joseph Willits, was trained as an
economist but was interested primarily in personnel and employment

45
 Industrial Relations in the Interwar Years

management, as indicated by both his professional writings and his

participation in programs sponsored by the Industrial Relations Asso,
dation of America and its successor, the American Management As,
sociation (Willits 1931). Under Willits, the department published a
number of articles and monographs on IR topics during the 1920s. The
PM orientation of its research program is evident in the topics of these
articles: promotion, training, attendance, labor turnover, and labor mo,
bility. The Wharton IR unit has maintained its management orientation
to the present time, making it the oldest IR unit in the PM branch of
the field. Reflecting the unit's PM heritage, its name was changed in
1990 to the Center for Human Resources.
The other five IR units established before World War II were at
Princeton University, Stanford University, the University of Michigan,
the Massachusetts Institute ofTechnology, and the California Institute
of Technology. Like the IR unit at Wharton, these were all affiliated
with the PM school of industrial relations.
The person responsible for the establishment of these units was Clar,
ence J. Hicks (see Hicks 1941:140-52). Hicks had a long career in
industry as both an executive and a management consultant on industrial
relations matters. One of his earliest and most important assignments
was for John D. Rockefeller, Jr., who hired Hicks in 1915 to establish
and administer an employee representation plan at one of his companies,
the Colorado Fuel and Iron Company. 1 Hicks went on to become the
executive in charge of industrial relations at Standard Oil (New Jersey);
chairman of the board of trustees of Industrial Relations Counselors,
Inc., the most prestigious IR consulting firm of its time; and a member
of the National Labor Board, which was created in 1933 to adjudicate
disputes arising from Section 7(a) of the National Industrial Recovery
Act.
In his memoirs, My Life in Industrial Relations, Hicks (1941) describes
his dissatisfaction with what he perceived to be the one,sided, pro,union
point of view that college students received in their labor courses. 2 To
help promote a more balanced view, Hicks helped organize industrial
relations units at the five major American universities cited above. 3 He
also helped found a sixth unit at Queen's University in Canada (see
Kelly 1987). 4
The first unit Hicks helped establish was the Industrial Relations
Section at Princeton, established in 1922 with the help of a generous

46
 Industrial Relations in the Interwar Years

financial gift from Rockefeller. The purpose of the section was to collect
and disseminate information on industrial relations topics, sponsor IR
research, and organize conferences and training classes for industrial
relations practitioners (primarily upper,level managers). The section was
organized as a subunit of the Department of Economics, although the
approach to industrial relations was intended to be multidisciplinary
(Brown 1976). Given Hicks's philosophical position on the practice of
industrial relations and the apparent triumph of welfare capitalism and
defeat of unionism in the 1920s, it is not surprising that the early research
output of the section had a heavy PM flavor. The first five publications,
for example, dealt with employee stock ownership plans, corporate train,
ing programs, labor turnover, absenteeism and tardiness, and group
insurance.
The four other U.S. IR sections Hicks organized were similar to the
one at Princeton. Of these units, the one at MIT has made the most
impact on the field. 5 Established in 193 7, it was started as a subunit of
the Department of Economics and Social Science (McKersie 1990) but
was later transferred to the Sloan School of Management. The section
initially had three faculty members, Rupert Maclaurin (economics),
Douglas McGregor (psychology), and Charles Myers (economics/per,
sonnel), each of whom served at some point as section director. The
research output of the section during its first decade was eclectic but
was weighted toward local labor market studies, human relations topics,
and personnel management.

INDUSTRIAL RELATIONS IN AcADEMic CuRRICULA

In the period from 1920 to 1941, no American university or college
had a separate degree program or department explicitly devoted to the
subject of industrial relations: 6 Several universities offered a major or
area of concentration in industrial relations, however, including Wis,
consin, Columbia, Michigan, and Missouri.
A concentration in industrial relations was offered at Wisconsin as
part of the major in economics. Students were required to take course
work in labor legislation, labor history and industrial government, un,
employment, and labor management. At Columbia University, an in,
formal Department of Industrial Relations was established in the School
of Business sometime in the late 1920s (U.S. Department of Labor 1930;
Van Metre 1954). The faculty included Paul Brissenden (economics),

47
 Industrial Relations in the Interwar Years

Ordway Tead (personnel management), and A. T. Poffenberger (psy-

chology). The department offered four courses-labor administration,
law of the employment of labor, adjustment of labor disputes, and per-
sonnel and employment problems. Other examples include the Uni-
versity of Michigan and University of Missouri. The former offered a
major in industrial relations in the MBA program (Industrial Relations
Counselors 1949), while the latter had an IR major in the undergraduate
business program (Bossard and Dewhurst 1931:306).
Although only a handful of American universities had any formal
curriculum in industrial relations in the pre-World War II period, the
subject was nevertheless taught at nearly all major state and private
universities (Bossard and Dewhurst 1931:429-30). The most common
vehicle was a survey course in labor problems, offered through an eco-
nomics department; a second but somewhat less frequently encountered
approach was to offer a course in personnel management, generally in
a school of business or commerce.
The labor problems course was the intellectual forerunner of what is
today called labor economics, although the theoretical and topical ori-
entation of the two subjects is quite different. A typical labor problems
text was divided into four sections (Persons 1927; Estey 1928; Daugherty
1936; Watkins and Dodd 1940). The first section was devoted to various
labor problems or "evils," such as the insecurity of employment, low
wages, industrial accidents, and child and female labor. The second,
third, and fourth sections were devoted to a discussion of "solutions"
to labor problems. Typically, one section was devoted to workers' so-
lutions, another to employers' solutions, and a third to the community's
solutions. These solutions involved, respectively, trade unions and col-
lective bargaining, personnel management (including scientific man-
agement, human relations, and employee representation), and
protective labor legislation and social insurance programs.
Most of the texts identified the discovery, implementation, and prac-
tice of these solutions as the subject matter of industrial relations (Wat-
kins and Dodd 1940: 10-11). The different solutions, in tum, represented
the policy programs of the PM and ILE schools of thought-the ILE
school advocated the first and third solutions (collective bargaining and
protective labor insurance legislation and social insurance), and the PM
school advocated the second (personnel management). The labor prob-

48
 Industrial Relations in the Interwar Years

lems texts represented, therefore, the 1930s' version of what today would
be called an IR theory text.
Several features distinguish the labor problems courses of the 1930s
from a post-1970 labor economics course. First, the emphasis on labor
problems gave the course of the 1930s a critical and reformist tone-
critical because it suggested that the capitalist system was prone to serious
maladjustments and defects that accounted for the "evils," and reformist
because it focused on changes in the organizational, economic, and
political status quo to solve these evils (Estey 1928; Yoder 1931). In
contrast, modem labor economics generally gives the market system
high marks for its allocative efficiency and for that reason tends to
emphasize the virtues of competition in free markets and the harmful
effects of institutional interventions (e. g., unions, minimum wage laws).
Second, labor problems texts were generally descriptive and written
largely from a historical and sociological point of view; they gave scant
attention to the operation of labor markets and the manner in which
demand and supply determine outcomes such as wages, hours· of work,
and so on. 7 Present-day labor economics texts are in many ways the
opposite. Finally, the labor problems texts spent several chapters ana-
lyzing personnel management, including topics such as the philosophies
and goals of management; personnel practices, such as hiring tests,
compensation systems, and techniques of performance appraisal; and
methods for dispute resolution. Modem labor economics texts generally
exclude these subjects altogether.

RESEARCH IN INDUSTRIAL RELATIONS

A review of industrial relations research during the interwar years is
complicated by the uncertain definition of what distinguishes IR from
non-IR research. The most narrow approach is to limit the focus to
those articles and books that have the term industrial relations in the
title. By this standard relatively little IR research was published during
this period. A bibliographic computer search keyed to the term produced
references to fifteen published works in the United States between 1930
and 1939. The majority of these references were to short bulletins pub-
lished in the Personnel Series of the American Management Association
(Sokolsky 1936; Miller 1937; Spates 1937, 1938; Stoll et al. 1937;
Chester 1939). Multiple references were also found to short studies

49
 Industrial Relations in the Interwar Years

produced by the industrial relations sections at Princeton University

(Industrial Relations Section [IRS], Princeton 1930, 1939; Baker 1939),
the California Institute of Technology (IRS, Cal Tech 1939), and the
National Industrial Conference Board (NICB 1931; Walter 1934).
Other significant references include a large PM~related monograph en~
titled Executive Guidance of Industrial Relations, by C. Canby Balderston
(1935) of Wharton's Industrial Research Unit, and two case studies of
labor~management relations in the building trades: William Haber's
(1930) Industrial Relations in the Building Industry and Frederick Ryan's
(1936) Industrial Relations in the San Francisco Building Trades.
There is also a paucity of IR~labeled research in the articles published
in major IR~related journals. Between 1930 and 1939, the American
Economic Review and the Quarterly Journal of Economics each contained
one article (Slichter 1939; Gulick 1932) with industrial relations in the
title, while the Personnel Journal contained two such articles (Brown
1935; Tead 1938) and the journal of Applied Psychology contained one
(Schultz and Lynaugh 1939).
By this criterion it would seem that industrial relations had a relatively
minor presence in academic research of the period. A different criterion
of what comprises industrial relations research leads to a significantly
different conclusion, however. For example, if one uses the term in~
dustrial relations as it was originally conceived, as pertaining to research
on any aspect of the employment relationship, there is suddenly a great
abundance of research, including studies by industrial psychologists on
employment tests, by historians on the origins and development of labor
unions, and by economists on wage determination. The problem then
is how to organize this mass of research so that it has some intellectual
coherence and point of reference.
The most noteworthy attempt in this regard was made by Delbert C.
Miller and William H. Form (1951) in the first edition of their text
Industrial Sociology. They presented a comprehensive bibliography of
research on industrial relations dating from the turn of the century to
1950. This bibliography was divided into eleven sections, based on their
judgment that research in the field came from eleven distinct disciplinary
or theoretical points of view. They represented the family tree of IR
research in a remarkable diagram, which is reproduced here as figure
3.1. The names attached to each branch are the authors listed in the
eleven sections of Miller and Form's bibliography.

50
 Industrial Relations in the Interwar Years

One may quarrel with specific aspects of the figure, but it nevertheless
provides an accurate portrayal of the development of IR research in the
years before 1940. 8 As the figure indicates, IR research spanned a wide
range of academic fields and included a very heterogeneous mix of topics.
Economics, sociology, anthropology, engineering, personnel manage,
ment, and psychology all contributed to the field. Topics investigated
included union history, wage determination, the practice of collective
bargaining, government regulation of the employment relationship,
working,class social structures and values, restriction of output by em,
ployees, preemployment hiring tests, attributes of effective leadership,
determinants of employee motivation and morale, and methods of in,
dustrial governance and conflict resolution.
As the figure also illustrates, from its earliest days, IR research was
composed of both behavioral and nonbehavioral science wings. The
nonbehavioral wing was represented by economics and industrial man,
agement (i.e., scientific management). The behavioral wing was initially
(1920s) represented by the discipline of psychology, both directly
through industrial psychology and indirectly through the psychological
component of personnel management. In the 1930s, the behavioral side
of IR research expanded greatly with the addition of several new branches
of thought, including industrial sociology, applied anthropology, and
what Miller and Form called the "Harvard Graduate School of Business
Administration" (the writings of Elton Mayo, T. N. Whitehead, and
Fritz J. Roethlisberger and William J. Dickson). The involvement of
all three fields was the result of a common catalyst, the research findings
of the Hawthorne experiments at the Western Electric Company, con,
ducted between 1924 and 1933. For this reason, all three branches are
commonly combined under the label of "human relations." Since the
human relations movement (the academic version, that is) did not
emerge with full force until the publication of Roethlisberger and Dick,
son's monumental study, Management and the Worker, in 1939, a full
discussion of this aspect of IR research is postponed until the next
chapter.
Figure 3.1 also clearly reveals the presence of what has been called
here the ILE and PM schools of thought in industrial relations. The
ILE school was composed of the institutional economics and industrial
and labor economics branches on the lefthand side of the figure. Initially,
the PM school was composed of the fields in the three most righthand

51
 FIGURE 3.1. Outlines of the Streams of Industrial Relations Knowledge

INSTITUTIONAL
ECONOMICS
1867 K.Marx
INDUSTRIAL.t
1867
IABOil ECONOMICS 1899
1899 T. Veblen
R. Ely
INDUSTRIAL 1903
1903
MANAiiEMENT INDUSTRIAL
1910 J. R. Commons 1910
PSYCHOLO~Y
1911 Taylor 1911

1912 Miinscer~rg 1912

~~~s T. VcbJen INDUSTRIAL I
Hollings\\'Onh &
1915
1917
1917 SOCIOLO§Y PERSONNEL
1919
1920
I
R. Tawney
I
S.&B.Webb
S. Gompcn
I
I
R.Macl~r

W.Williams
F. R. Donovan
.MANAEiEMENT Porfenbc:rgcr

Teed & Metcalf

1919
1920

\.Jl
N
1922
1923
1925
M. Weber
T. Veblen
R. Tawney
S. Perlman

I .
SCott &: Ooth1er Farnsworth
1922
1923
1925

I I
W.Williams
1926 J.M.Ciark H. Bum 1926
1927
19.28
G. D. H. Cole
S. Perlman E.T. Hiller
I
A. Pnffenbcrger
1927
1928

I
F. R. Donovan
R. &: H. Lynd Tnd
I
V. Anderson 1929
1929

19.~0

JQ.H
M.Webet
E. Durkhtim
HARVAilD
61\ADLIATE SCHOOL
OF BUSINESS
I
H. Hepner
1930

1931
19,\.:!

1933
I
A. ~le & G. Means
E. E. Witte

A. Todd
E. W. Bakke SOCIOMETRY
ADMINISTMTION

M•yo Urwick Ttad &: MHCalf

P. Achilles
M. Viceles

I
1932

1933

1~34
I
T. Veblen M=no C. Griffith 1934
L Mumford M. Vi11~-lcs
H. Hcpntr
1935
I
J.Davis S. ~rlman & P. Taft
PUBLIC
ADMINISTAATION 1935
L Co"!' LHuberman
1936
I I T. N. Whilt"head J. Gaus, L
D. Whice
& M. Dimock
I 1936

1937 T. Arnold R. R. Brooks

D. Yoder
Davidson & Anderson
Fairchild
I L Gulick & L Urwick W. Bingham
I
1937

I
S. Chase
I
1938
I I F. R. Donovan
I
T. N.
I
Wh~hnd llonwd
I
c. c. Balderston
Wad.:W& Dodd
E. K. Strong
I
1938
 I I I
1939
\
P. Pigon. L C. McKettnc"Y
& T. 0. Armstrong
I Ronhlubc-rf:C't &
[)i(kson
I
Lansburg &:
Hanmann
Mj &del)'i
& Ne.,.con>b, EJ. \939

1940

I
5. Hardwood

I
1940 K. Mannheim P. Landis
fl. W. Bakke Sprieg"l Bin,l!ham & Moore:

1941 J.
I Burnham S. H. Slichtcr
I
W. F. Cottrell
APPLIED
ANTHRO• Roethlisberger Foller & Metcalf
A. Walton
1941

1942
I
T. Arnold
C R. Daugherty
Rj A. Lester
C. Golden &
H. Rum-nberg
A. Jont'S
I
L Wilson
PfLO<jY
Arensburg
Richardson
I
Riegel Yoder J.liffin
C ROgers
1942

I
F. Graham

194.\
J. A. Schumpeter
I
R. Brady
I
S. H. Patterson E. Hughe-s JennmJ,>s Fa~ & Scott
I
Urwid;
H. Hl."pncr
H. Moore

I 1943
1944 K. Polanyi N. Chamberlain Mayo &. Lombard M. Smith 1944

194S
W. Ber~
s. Chut>
C. Whittelest:y
J. Dunlop
P. Drucker
M1lh~ .X MontE:Omcry
I
B. B. Gardner
I
lundberg
Jacobs
SOCIATRY
8< <;ROUP ~1ghton
I
Mayo M. Dimock Tead
I
C. Nonhcon
Wahers
R. McMurray
I
N. Cantor 1945

1946 I
I
F. Peterson
I
W.Moore
I
Rogers
.----
DYNAMICS
Moreno
I E. Chapple&:
S. Lewis(lhn
I
N. R. F. Maier 1946
W.Whyre French Donald

1947
I
E. W. Bakke
B. Sc:lekman
I
W. L. Warner & Low
I
ZC'ltn)'
Bradford&:
Lippitt
Bavclas Mayo J-Gaus
H. A. Simon
Breaded
I
Pigors & Myers
Jucius
I
T. Ryan
C. Tbomason
1947
VI
\.N
1948
I
G. Swcking
Harbison & Dubin
Bakke & Kerr
W. H. Hopkins
). Barbash
I
W. Whyte
Mills & Schneider
I
Lewin
I
Roethl1sht-rw:r
I
Barnard
I
Ghisdli
I
H.-Bum 1948
& M. Watkins R. Thornd1kc
l.es«-r &: Shisrer

I I
G. Srockins

I I I

I
&:M. Warkms A. Ross
N. Chamberlain
1949 E. Ginzberg Richardson & Walker Lippitt Lc:ighron P. Appleby Niles Thompson M. L. Blum 1949

I J. Shisrer
L Reynolds
L. G. Reynolds
& ). Shisrer
Pigors

j j
Bdlows
Hemphill

I
19SO V. Mund P. Mt:adows 1950

J
KNOWLEDGE OF INDUSTRIAL RELATIONS

Source: Miller and Form 1951.

 Industrial Relations in the Interwar Years

branches, industrial psychology, personnel management, and industrial

management. Later, the PM side was augmented by other behavioral
science fields, such as anthropology and industrial sociology, in the
middle of the figure.

A CoRREcTION oF THE HisTORICAL REcORD

In their discussion of the pre-World War II period of industrial re-

lations, Strauss and Feuille (1981:86) claim that "economics is industrial
relations' 'mother discipline', and for many years industrial relations and
labour economics were viewed as virtually synonymous." They also say
(p. 77) that "Commons and his colleagues and students at Wisconsin,
especially Selig Perlman and Edwin Witte, comprised the Wisconsin
school, which together with colleagues with similar interests, such as
Harry A. Millis and Robert Hoxie at Chicago, defined the nature of
the field and the chief questions that it has considered over the years."
Barbash ( 1984:4) makes a similar claim: "In an earlier period industrial
relations would have been just about the same as institutional labor
economics, founded by John R. Commons and the Wisconsin school."
It should be clear from the preceding discussion that assertions such
as these are significantly wide of the mark in that they neglect altogether
the existence of the PM school of industrial relations and that this
stream of thought is grounded largely in management and the behavioral
sciences. Since the viewpoint expressed by the quotations cited above
is frequently encountered, one must ask why this misinterpretation has
gained such a widespread following.
To begin, there can be no gainsaying that the institutional economists
were the first academic group to begin serious research in the field of
labor problems (McNulty 1968). It is also indisputable that the most
influential writer and teacher in the early years of industrial relations
in North America was John R. Commons, a fact that legitimately earned
him the title "father of industrial relations. "9 Thus, given the early
involvement of the institutionalists in the development of the field of
industrial relations and the preeminent role played in the birth of the
field by Commons (the leading exponent of institutionalism), it is ap-
propriate that writers would emphasize the strong relationship between
institutional economics and the development of industrial relations.
To say that institutional labor economics and industrial relations were

54
 Industrial Relations in the Interwar Years

virtually one and the same is, nevertheless, far from the truth. Several
reasons most likely account for this confusion.
It is not always recognized that in the 1920s-30s the discipline of
economics, and labor economics in particular, contained an extremely
heterodox group of scholars. Some of these scholars were truly econo-
mists in that they were conversant with economic theory and interested
in economic subjects per se. Others, however, had much greater ex-
pertise in related fields, such as personnel management, labor history,
sociology, and law. Before World War II, for example, most of the
influential academic writers on personnel management, including Paul
Douglas, Sumner Stichter, Gordon Watkins, and Dale Yoder, had de-
grees in economics. Similarly, labor history was dominated by econo-
mists, including Commons, Selig Perlman, and Phillip Taft.
In both cases, at least some of these people (e.g., Watkins, Perlman)
were not economists as defined above, although their doctoral degrees
were in economics. Most schools of business in the pre-World War II
period considered personnel management and other business-related sub-
jects to be "applied economics" and included them under the curricular
umbrella for the doctoral degree program in economics (Gordon and
Howell1959:400-402). 1° Furthermore, labor economics during this pe-
riod was construed broadly to encompass nearly all subjects pertinent
to the employment and utilization of labor, including personnel man-
agement and trade union history, which today would be considered the
province of other fields of study (McNulty 1980: 156-59). Thus, even
though a significant number of the early writers in industrial relations
were "economists," this does not mean that economics, at least as the
discipline is conceived today, was the principal intellectual wellspring
of the field.
Another potential source of confusion concerning the roots of in-
dustrial relations involves the labor problems courses offered during the
period. The labor problems course was the closest equivalent to an IR
theory course in that it focused squarely on the causes and resolutions
of labor problems. It was also in the labor problems texts where the
most frequent mention of the term industrial relations was found. Because
these courses were nearly always taught by economists, particularly in-
stitutional economists, it is not surprising that scholars concluded that
institutional economics was the major intellectual wellspring of indus-
trial relations. Such an inference, however, founders on the fact that

55
 Industrial Relations in the Interwar Years

nearly every labor problems text featured both the PM and the ILE
perspectives on labor problems (the employers', workers', and com-
munity's solutions to labor problems) and provided extensive coverage
of personnel management and employee representation plans. These
subjects, it will 'be recalled, were the mainstays of the PM approach to
improved industrial relations; were based heavily on knowledge derived
from the fields of engineering, administrative science, and psychology;
and had been written about principally by persons with a management
background. Thus, on the one hand, the labor problems texts undeniably
had a heavy institutional flavor, as one would expect given the dis-
ciplinary background of the authors, but, on the other, these texts al-
so made a concerted attempt to present both the ILE and the PM
perspective.
Yet another source of the confusion pertains to the undeveloped
nature of institutional economics. As envisioned by Commons, insti-
tutional economics was to be a new approach to the study of the fun-
damental questions of economics-the allocation of resources and
determination of output, prices, and the distribution of income. T award
that end, he attempted to construct a theoretical model based on con-
cepts such as a volitional theory of value, transactions, reasonable value,
and property rights, with heavy emphasis on the role of law and judicial
opinion {Commons 1924, 1934b, 1950). Unfortunately, his foray into
theory was largely unsuccessful; neither his fellow economists nor his
students could understand what he was driving at, .and his conception
of economics was so expansive that his writings had more in common
with law and sociology than with economics per se. Given the failure
of Commons and his students to develop institutional theory, institu-
tional labor economists fell back on a largely historical, descriptive,
multidisciplinary analysis of labor problems and institutional solutions
to those problems. 11 This approach was largely coterminous with the
subject of industrial relations, however, a fact that made the two subjects
seem as if they were one and the same. In practice, they were largely
one and the same, but only because the institutionalists failed to develop
theory.
Another probable reason for the confusion is that contemporary
chroniclers of industrial relations tend to ignore the extensive literature
of the 1920s-30s authored by nonacademics, most of whom were busi-

56
 Industrial Relations in the Interwar Years

nessmen or consultants who approached the subject of industrial rela,

tions from a management and behavioral science perspective. 12 Several
authors of the PM school were affiliated with universities, including
Mayo (1929, 1933), Stone (1932), and Balderston (1935), but most
PM writers in the 1920s-30s were businessmen or consultants. Meyer
Bloomfield and Daniel Bloomfield, for example, together or individually
authored numerous articles and edited several books in the 1920s on
employment management, personnel management, and industrial re,
lations (D. Bloomfield 1919, 1920, 1931; M. Bloomfield 1923). Another
example, from the 1930s, is Thomas Spates, who was vice,president for
industrial relations at the General Foods Corporation, a staff member
of Industrial Relations Counselors, and, later in his career, a professor
of personnel administration at Yale University. Spates wrote several
articles on industrial relations (Spates 1937, 1938, 1944), most for the
Personnel Series of the American Management Association.
Two business,sponsored research organizations also did pioneering
research on industrial relations that was noneconomic and nonacademic
in nature. The most noteworthy was Industrial Relations Counselors
(IRC). Founded in 1926 with financial assistance from John D. Rocke,
feller, Jr., the IRC was a nonprofit research and consulting service to
industry, the purpose of which was to promote improved relations be,
tween employers and employees (Teplow 1976). In addition to Clarence
Hicks, who served as chairman of the board of trustees of the IRC for
several years, other members of the firm included Arthur Young, at one
time a vice,president of the United States Steel Company, a vice,
president of the Industrial Relations Association of America, and a
member of the faculty of the Industrial Relations Section at the Cali,
fornia Institute of Technology, and Bryce Stewart, who Commons
(1934a:200) labeled "the leading authority in the country on unem,
ployment insurance." Under the auspices of the IRC, fifteen research
studies on industrial relations topics were published between 1930 and
1939. These studies were widely regarded as of equal or better quality
than anything done in academia at that time. 13 The IRC was also
involved in industrial relations research sponsored by the International
Labor Organization in Geneva, Switzerland.
The business,sponsored National Industrial Conference Board (today
called the Conference Board) also published various IR,related studies.

57
 Industrial Relations in the Interwar Years

Two studies, for example, were on industrial relations practices in small

manufacturing plants (NICB 1929) and experiences with employee rep-
resentation plans (NICB 1933). 14
Finally, it is probable that the heavy emphasis put on the role of
institutional economics stems in part from the intellectual and ideolog-
ical background of the persons who have been the primary chroniclers
of the field's history. As discussed in detail in later chapters, for the last
thirty years most of the academic writers in industrial relations have
been associated to one degree or another with the ILE school. It is not
surprising, therefore, that historical accounts of the field give consid-
erable weight to the contributions of the institutional economists and
their point of view, particularly given the preeminent role played by
Commons in the early days of the field, that economists were the first
group among academics to write extensively about industrial relations
topics, and the lack of participation by members of the PM school in
industrial relations in recent years.

58
 4
THE INSTITUTIONALIZATION OF
INDUSTRIAL RELATIONS

I NDUSTRIAL RELATIONS was born out of the crises in the workplace

engendered by World War I, but its growth and development was
sufficiently slow that twenty years later there was still no formal
-
degree program devoted explicitly to the study of industrial relations in
an American university. From 1940 to 1950, however, the field under-
went a fundamental transformation from which it emerged as a highly
visible, rapidly growing area of research and teaching. Three events
symbolized this transformation: the founding of IR schools and institutes
at major universities; the founding of a new professional association,
the Industrial Relations Research Association; and the founding of the
first academic journal in America devoted to industrial relations, the
Industrial and Labor Relations Review. This chapter first reviews the eco-
nomic and political events that precipitated this transformation and
then examines in more detail these three key developments in the field.

PIVOTAL EcoNOMIC AND PoLITICAL EvENTS

Research and teaching in industrial relations, as in every field of study,
are significantly influenced by events and developments in the economic,
social, and political spheres. This is particularly so for industrial rela-
tions, given its applied, problem-solving orientation. The sudden pop-
ularization of industrial relations after World War II cannot be
understood without giving some consideration to these developments.
The 1920s were a highly favorable period for the PM school of in-
dustrial relations in that it saw the birth and spread of welfare capitalism
as a number of medium- and large-sized companies instituted various

59
 Institutionalization of Industrial Relations

progressive personnel practices, including paid vacations, pensions, su-

pervisor training, improved working conditions, and employee repre-
sentation plans (Stewart 1951; Bernstein 1960). Although these
measures smacked of paternalism and unilateralism, workers seemed
willing to accept management's control of the workplace as long as the
companies delivered on their promise of providing job security and a
steady increase in pay. The success of welfare capitalism in the 1920s,
coupled with the economic prosperity and politically conservative, pro-
business climate of the period, dramatically undercut the appeal of labor
unions, as witnessed by a drop in union membership of more than 1
million during the decade.
The challenge for nonunion employers, as Commons noted, comes
in periods of recession and depression, for it is then that competitive
pressures lead managers to search out ways to cut costs and increase
productivity. Frequently these goals are accomplished at labor's expense,
through layoffs, wage cuts, longer hours, or a speed-up of the work.
Workers in this situation suddenly discover that the presumed mutuality
of interests has been replaced by a conflict of interests, bringing with it
a struggle over the terms and conditions of employment. Given workers'
unequal power position with respect to both authority and pay, it is not
surprising that union representation also becomes more attractive.
This scenario was vividly played out in the Great Depression (Bern-
stein 1970). With the onset of the depression in late 1929, America's
corporate leaders pledged to hold the line on labor standards and avoid
the liquidation of labor and personnel programs that had occurred in
the previous business downturn of 1921-22. This pledge was largely
honored until the fall of 1931, when the economic decline intensified
and first marginally profitable firms and then their stronger competitors
were forced to implement wage cuts, layoffs, and speed-ups. Once the
dam was breached, a downward spiral in labor standards ensued until
the nadir was reached in early 1933. By then, money wages had been
reduced by nearly one-third and 25 percent of the work force was un-
employed (including more than half of those employed in durable man-
ufacturing). The net outcome of this debacle was a serious demoralization
of both employers and workers, a growing mood of discontent and bit-
terness among workers over the perceived injustices associated with the
downward spiral of wages and working conditions, and the discrediting

60
 Institutionalization of Industrial Relations

of the PM school and its ethos of individualism, competition, and en-

lightened paternalism (Brody 1980).
The strategy adopted by the Roosevelt administration to revive the
economy was largely institutional in inspiration (not Keynesian as often
alleged). 1 The plan was to short-circuit the decline of wages and prices
caused by destructive competition, either by restricting competition
(cartelizing markets) or establishing negotiated or legislated minimum
wage and price floors, and then to restore purchasing power and demand
by redistributing income from the rich, whose propensity to spend is
low, to the working class, whose propensity to spend is high.
With respect to the labor market, three methods were used to ac-
complish these objectives: to substitute collective bargaining for indi-
vidual bargaining, to use legislation to establish minimum labor standards
(e.g., minimum wages, maximum work hours), and to establish social
insurance programs (e.g., unemployment compensation, Social Secu-
rity) that provided income security and purchasing power to wage earners
and, in the case of unemployment compensation, incentives to em-
ployers to minimize layoffs.
It is still a matter of debate among economists whether these policies
helped bring the country out of the depression. There is no debate,
however, that they fundamentally transformed the nature of the em-
ployment relationship across a wide swath of American industry. Most
important in this regard was the passage of several pieces of labor leg-
islation, including the National Industrial Recovery Act, the National
Labor Relations Act, the Fair Labor Standards Act, and the Social
Security Act. Of these, the most important for industrial relations was
the National Labor Relations Act (Wagner Act), enacted into law in
1935. The act declared that the goal of public policy was to encourage
the practice of collective bargaining, both to eliminate labor's inequality
of bargaining power and to introduce democratic rights of independent
representation and due process into industry {see Keyserling 1945). 2 The
act established the union representation election process, proscribed a
series of "unfair labor practices" (e.g., discharge of union activists), and
established the National Labor Relations Board to administer the act.
In the early 1930s, union membership was about 10 percent of the
work force and was concentrated in a handful of industries, such as
construction, railroads, the needle trades, and coal mining. By 1940,

61
 Institutionalization of Industrial Relations

however, union membership had tripled, and it now represented almost

30 percent of the nonagricultural work force, with much of the gain in
the previously unorganized mass,production industries, such as auto,
mobiles, steel, rubber, meatpacking, and electrical equipment. While
the passage of the Wagner Act was probably the single largest impetus
to union growth, the formation of the Congress of Industrial Organi,
zation (CIO) and the rivalry between the CIO and the American Fed,
eration of Labor (AFL) were also significant.
Accompanying the meteoric growth in union membership was a sim,
ilar surge in strikes, pickedine violence, and bloodshed as workers
aggressively fought to secure union representation and collective bar,
gaining while the broad mass of employers fought back equally hard to
keep unions out of their plants. The level and intensity of conflict were
such that Sydney Lens (1974) aptly called the strikes of this period
"labor wars."
The events outlined above catapulted collective bargaining and labor,
management conflict to the forefront of public concern. The entrance
of the United States into World War II further heightened this concern.
It was essential that employers and unions hold wages and prices in
check to prevent inflation from spiraling out of control and that the
issue of union recognition and bargaining disputes be speedily resolved
lest strikes and labor unrest disrupt war production. To enforce "re,
sponsible" behavior on the part of both parties, the federal government
created the War Labor Board and gave it authority to administer wage
and price controls and to investigate and resolve labor disputes (Rayback
1966). The latter was done through tripartite commissions composed of
representatives of labor, management, and the public that held hearings,
attempted to mediate a resolution of the dispute, and, failing that,
rendered a binding arbitration award.
Although the Board largely succeeded in stabilizing labor,
management relations during the course of the war, paradoxically its
activities increased the probability of conflict after the war. Many com,
panies thought they had been pressured by the Board to recognize unions,
sign collective bargaining contracts, and agree to new or expanded
contract provisions that they otherwise would not have done. Once the
war was over, these companies were intent on recapturing their losses.
Many unions also looked forward to the end of wartime controls, for
they too were intent on making up for lost bargaining opportunities,

62
 Institutionalization of Industrial Relations

particularly with regard to wages, which had badly lagged behind both
prices and corporate profits. The prospect, therefore, was for renewed
labor-management conflict at the end of the war on a scale as large or
larger than when the war began five years earlier. (This prospect became
a reality in 1946 when the economy experienced a strike wave of un-
precedented proportions.)
From the perspective of 1945, then, employer-employee relations,
and labor violence and unrest in particular, was suddenly the number-
one domestic issue confronting the nation. just as the labor conflict _-
engendered by World War I precipitated the birth of the field, the labor
conflict of the Depression and World War II years led to the emergence
of industrial relations as a widely recognized, fully institutionalized ac-
ademic field of study. 3 Industrial relations had come of age.

NEw INDUSTRIAL RELATIONS PROGRAMS

Given the relative paucity of research centers and degree programs
in industrial relations in the pre-1945 period and the magnitude of the
labor problems facing the country, it is not surprising that legislatures
and state university systems quickly acted to fill the gap by creating new
units expressly dedicated to research and teaching in industrial relations.
Among the most important of these programs were those at Cornell
University (1945), the University of Chicago (1945), the University of
Minnesota (1945), the University of California (1945), Yale University
(1945), the University of Illinois (1946), Rutgers University (1947),
the University of Wisconsin (1948), New York University (1948), and
the University of Hawaii (1948). 4 A number of Catholic colleges and
universities were also in the forefront of establishing IR programs, al-
though these were generally smaller and emphasized teaching over re-
search. Examples include Rockhurst College (Kansas City), Loyola
University (Chicago), Manhattan College (New York City), Seton Hall
(New jersey), and St. joseph's (Philadelphia) (see Graham 1948; Justin
1949). 5
The organizational structure and functions of these programs varied
greatly. The most comprehensive and prestigious program was the New
York State School of Industrial and Labor Relations at Cornell Uni-
versity. The school was an autonomous unit of the university, had forty
faculty (as of 1949), offered a full range of resident instruction programs
(i.e., a four-year undergraduate degree, a two-year master's degree, and

63
 Institutionalization of Industrial Relations

a doctoral degree} and numerous extension courses off campus for both
union and management groups, and conducted extensive research on
all aspects of industrial relations. Graduate students could choose a major
or minor field of concentration in collective bargaining, mediation, and
arbitration; human relations in industry; industrial and labor legislation
and social security; labor market economics and analysis; labor history,
organization, and management; personnel management; or industrial
education.
Most other universities followed the Cornell model in that they
housed their industrial relations programs in a free-standing adminis-
trative unit, as opposed to a subunit of an existing department (e.g.,
economics) such as had been done at Princeton and MIT. The most
common designations given to these units were school, institute, and
center.
Some of the units were in business schools, but this was not the
preferred approach. Rather, the more common arrangement (Rezler
1968a) was to house the program in a nonbusiness division of the uni-
versity, such as a graduate school or a college of arts and sciences
or social sciences; to make the unit an autonomous division of the
university; or to divide administrative control of the unit among several
departments or schools, emphasizing interdisciplinary control and
coordination.
Placing the IR unit outside the business school facilitated the re-
cruitment of a multidisciplinary faculty from all the major divisions of
the university, ensured that the unit's intellectual and ideological neu-
trality on labor-management issues was not compromised, and allayed
fears among organized labor that the units would become tools of the
business community. An additional consideration at some universities
was that the business school was hostile to the concept of a joint labor-
management program. 6
Placing the units outside the business school also created "turf' prob-
lems, however, since both the IR units and the business schools claimed
jurisdiction over personnel and human relations subjects. Some uni-
versities (e.g., Illinois) resolved the conflict by permitting both theIR
unit and the business school to hire faculty and teach courses in these
areas. 7 This arrangement was satisfactory for the IR units because it
allowed them to offer management-related subjects. In addition, the

64
 Institutionalization of Industrial Relations

personnel and human relations area in business schools was underde,

veloped and represented little effective competition, particularly since
relatively few students majored in personnel at the time. 8 Thirty years
·later, however, the shift in student demand from labor relations to
personnel and human resources significantly increased the competition
between the IR units and the business schools, often to the detriment
of the former. (This subject is discussed further in chapter 7).
Wide variation also existed among the units with regard to their
functions and activities (Rezler 1968a). A minority were "full service"
in scope, in that they offered their own courses, on,campus degree
programs, and off,campus extension classes for management and labor
groups and promoted an active faculty research program. The more
common practice was for the unit to offer one or more of these activities
but not all. 9 Some offered both undergraduate and graduate IR programs,
but most offered graduate,level (master's) programs only. Only two uni,
versities in the 1950s offered a Ph.D. degree in industrial relations,
Cornell and Wisconsin. 10 Finally, some IR units had their own full,time
faculty and administrative control over courses, while others shared
faculty (generally on a joint,appointment basis) and courses with other
departments in the university. 11
An important part of the mission of many IR units was to provide
labor education courses to unions in the local area. Unions generally
found this service, offered on an extension basis, more valuable than
the academic degree programs offered through resident instruction (Rut,
tenberg 1958). Involvement in labor education brought with it both
benefits and costs. On the benefit side, it strengthened ties between the
academic community and the labor movement, provided an important
educational service to a constituency that otherwise would not have had
the opportunity to obtain university instruction, and provided a valuable
bridge between theory and practice for faculty. On the cost side, the
involvement of the IR units in labor education caused many business
leaders to regard them as pro,labor, created internal cleavages between
faculty who specialized in resident instruction and research and those
who specialized in extension education (the latter were viewed as less
prestigious and were generally compensated accordingly), and caused
numerous administrative headaches with regard to promotion and tenure
(see Derber 1987). Some IR units decided that the benefits were worth

65
 Institutionalization of Industrial Relations

the costs and maintained their labor education activities, while others
phased out their extension work or transferred extension activities to a
separate administrative unit (e.g., a labor studies department).
A significant degree of standardization existed among IR units with
respect to their curricula. Martin Estey (1960), who conducted a survey
of IR curricula, found, for example, that four courses comprised the
"core" of most IR programs: personnel management, labor economics,
labor law, and collective bargaining. Among the other courses that were
frequently taught were human relations in industry, trade unionism and
union government, industrial sociology, industrial psychology, social
security, and comparative labor movements (also see Schnelle and Fox
1951). These courses corresponded closely to the major areas of con-
centration in Cornell's program. Other IR programs could not match
the breadth and depth of the courses offered by Cornell, but they never-
theless offered concentrations in a number of the same areas. The Illinois
program, for example, had four areas of concentration: labor economics
(including collective bargaining, labor legislation, mediation and arbi-
tration, and social security), human relations in industry, labor union
organization and administration, and personnel management.
Finally, the names attached to the units varied in some interesting
ways. Most included the term industrial relations, either alone or in
combination with some other term. Examples of the former include the
Institute of Industrial Relations at Berkeley and the Industrial Relations
Center at Minnesota; examples of the latter include the School of In-
dustrial and Labor Relations at Cornell and its near equivalent, the
Institute of Labor and Industrial Relations at Illinois; and the Industrial
Relations Research Institute at Wisconsin. Several programs did not use
industrial relations in their titles: the Labor and Management Center
(Yale), the Institute of Management and Labor Relations (Rutgers),
and the Institute of Labor Relations and Social Security (New York).
Several aspects of these new IR programs are important. First, the
goal of the new units was to promote both problem-solving and science-
building, but problem-solving was the first priority. The legislation that
established the School of Industrial and Labor Relations at Cornell, for
example, stated that the unit's mission was "to improve industrial and
labor conditions in the State through the conduct of research and dis-
semination of information in all aspects of industrial, labor, and pub-

66
 Institutionalization of Industrial Relations

lie relations, affecting employers and employees" (quoted in Adams

1967:733).
Second, in keeping with the original conception of the field, the new
units were also explicitly organized on a multidisciplinary basis. Thus,
all the units brought together faculty and course subjects from the several
disciplines that touched on the employment relationship and, more
specifically, on the pressing labor problems of the times. The intellectual
rationale (strongly believed at that time by most in the field) was that
the study and resolution of labor problems would be materially advanced
by an interdisciplinary melding and integration of ideas and research
methods, an intellectual cross,fertilization that would take place only
if faculty from the various disciplines were brought together in one
administrative unit so they could interact on a personal and daily basis. 12
Third, the new units contained faculty and courses that represented
both the ILE and the PM schools of industrial relations. The ILE school
in the late 1940s-early 1950s had broadened beyond its base of insti,
tutional labor economics to include academics from labor law, labor
history, and political science. The PM school had likewise expanded
from its base of personnel management and industrial psychology to
include faculty from human relations, industrial sociology, management,
and anthropology. Thus, the ILE wing of the field was represented in
the Cornell program by courses and faculty in such subject areas as
collective bargaining, mediation and arbitration, industrial and labor
legislation and social security, and labor market outcomes and analysis,
while the PM perspective was provided in human relations in industry,
personnel management, and industrial education.
Every large IR program (including the institutes devoted solely to
research) contained a disciplinary mix offaculty, although the relative
weight given to particular disciplines and the overall ILE versus PM
orientation of the prograll)S differed. In general, the units had a strong
ILE flavor {about 7 to 8 on a scale of 1 to 10, with 10 being complete
ILE). The Cornell program was close to the average. 13 The Minnesota
program, in contrast, was more PM,oriented, a reflection of the strong
interest in personnel administration among three of the unit's well,
known faculty, Dale Yoder, Herbert Heneman, Jr., and Donald Pat,
terson. Yale's Labor,Management Center (a subunit of the Institute of
Human Relations) also had a relatively strong PM perspective, whereas

67
 Institutionalization of Industrial Relations

the programs at Illinois, Wisconsin, and Michigan State were above

average in their ILE focus. 14
The ILE orientation of most of the new IR programs was attributable
to several factors. One was the impact of current events. Given the
meteoric rise of unionism, collective bargaining, and strikes in the dec~
ade after 1935, it was not at all surprising that most of the new programs
had an ILE orientation. After all, labor~management relations was the
number~one domestic problem facing the country. Another was that
economists had historically been the group most actively involved in
research and teaching in the area of labor~management relations, so it
was to be expected that they would be disproportionately represented
in the new IR programs and bring an ILE perspective to them. Also
contributing to the ILE orientation was public sentiment, which was
relatively favorable toward unions and collective bargaining. This fact
was mirrored in the values and beliefs of most IR academics of the period
regardless of discipline. Finally, in contrast to the ILE side, the subject
areas on the PM side of industrial relations either lacked academic
respectability or were relatively new and underdeveloped. Personnel
management, for example, had an atheoretic, cookbookish, practitioner
flavor, whereas industrial sociology, human relations, and administrative
science and organization theory were still in their infancy. 15 In addition
to its intellectual shortcomings, personnel management suffered a sig~
nificant image problem because of the public's perceptions that it was
often used by companies as a manipulative, stop~gap device to keep out
unions (Yoder 1952).
The fourth notable aspect of the new IR units was that they were
controversial, particularly with regard to their perceived pro~labor tilt.
Research and teaching resources had for years been devoted to the study
of business. From the point of view of the backers of the new units, it
was only fair that the same should be done for blue~collar workers and
labor unions. Thus, many IR units established boards of advisers that
included representatives of both management and labor, brought both
union and company officials to campus for lectures and seminars, and
sponsored off~campus extension classes for management and union mem~
hers on subjects such as supervisor training and handling grievances.
This attempt at evenhandedness was only partially successful. Many
employers' groups strongly resisted the establishment of the new IR units.
One significant reason was the basic incompatibility of viewpoints. The

68
 Institutionalization of Industrial Relations

IR units took the existence of unions and the necessity (if not the virtue}
of collective bargaining as "givens" and thus saw their mission as pro~
mating dialogue and accommodation between labor and management.
Many employers remained steadfastly anti~union, however, and thus
saw the attempt at dialogue as a thinly disguised attempt to promote
collective bargaining.
Other considerations also came into play. The creation of the IR
units increased substantially the amount of teaching, research, and uni~
versity resources devoted to the organized labor movement, a movement
many employers saw as threatening their economic position and power.
Many employers also believed that the faculty of the IR units were
ideologically pro~union and thus were inculcating students with biased,
antibusiness viewpoints. They also charged that the units were agents
of socialism and communism, given their alleged bias in favor of col~
lectivist solutions to labor problems. As a result of all of these pressures,
many unit directors had to beat back attempts by employers and their
allies in the university system to eliminate the programs. 16 The IR units
also found that many employers were very reluctant to participate in
classes or conferences or to be on advisory boards if representatives of
organized labor were also participating.
While the primary threat to the new IR units came from the employer
side, they did not escape attack and criticism from labor. Many officials
of organized labor were suspicious of the programs since universities in
the past had been largely antagonistic to the aims and methods of the
labor movement. Labor leaders were also skeptical about becoming in~
valved with intellectuals, who often promoted goals or methods that
were not grounded in the pragmatic experience of trade unionism (Ware
1946). For these reasons, some center directors had to fend off attempts
by trade union leaders to purge the programs of management courses
and management representatives, which, if successful, would have
turned the units into labor education programs. The universities resisted
these lobbying efforts, as well as those of management, thus preserving
at least a modicum of balance in both IR research and teaching.

FouNDING oF THE IRRA

Until the founding of the Industrial Relations Research Association
(IRRA) in late 194 7, the only other professional association to bear the
name industrial relations had been the short~lived Industrial Relations

69
 Institutionalization of Industrial Relations

Association of America. With its demise in 1922, no professional group

in America existed for the next twenty-five years for either academics
or practitioners that made industrial relations the focal point of its
programs and activities.
The IRRA had its genesis in January 1947. 17 At the annual meeting
of the American Economic Association (AEA), Richard Lester of
Princeton University, with the assistance of William McPherson of the
University of Illinois, organized an informal meeting of about thirty
labor economists to discuss the need for and feasibility of creating a
learned society in the field of industrial relations. A twenty-person or-
ganizing committee was created, and in late 1947 a constitution and
set of bylaws were adopted and a slate of officers was elected. The first
president-elect was Edwin Witte, an institutional labor economist from
the University of Wisconsin and a former student and colleague of john
R. Commons.
By late 1948, the IRRA had almost one thousand members, drawn
from academe, industry, and government. At its first annual meeting,
held in late December 1948, in conjunction with the meetings of the
AEA, five paper sessions were included on the program: "Collective
Bargaining, Wages, and the Price Level"; "Disputes That Create a Public
Emergency"; "Developments in Social Security"; "Collective Bargaining
and Management Rights"; and "The Role of Various Disciplines in
Industrial Relations Research." The IRRA continued to grow rapidly,
reaching a membership of sixteen hundred four years later.
Like the academic IR programs, the IRRA endeavored to be inclusive
in both disciplinary representation and ideological beliefs. Its track rec-
ord in this regard has been mixed, however, and it has certainly fallen
short of the record in IR teaching. As a matter of policy, the IRRA has
been committed to preserving and promoting the multidisciplinary char-
acter of industrial relations and, in particular, to bringing members of
both the PM and the ILE schools into its ranks. The constitution of
the IRRA states that one of the purposes of the association is "the
encouragement of research in all aspects of the field of labor-social,
political, economic, legal, and psychological-including employer and
employee organizations, labor relations, personnel administration, social
security, and labor legislation." The organization also adopted a position
of neutrality regarding issues of ideology and public policy, particularly
with regard to trade unionism. Thus, the constitution says that "the

70
 Institutionalization of Industrial Relations

Association will take no partisan attitude on questions of policy of labor,

nor will it commit its members to any position on such question."
As shall be discussed in more detail in later chapters, the IRRA has
never fully lived up to its good intentions. An examination of the
organization's founding and early activities, for example, clearly reveals
that it was largely composed of, and controlled by, ILE~oriented labor
economists. Lester and McPherson were members of this group, as were
three~quarters of the members of the organizing committee. The ILE
orientation is also evident in the people who have served as the orga~
nization's president. Edwin Witte, the first president, was the closest
surviving heir to the institutional tradition of Commons and the Wis~
consin school. The next twelve presidents were Sumner Stichter ( 1949),
George Taylor (1950), William Leiserson (1951), ). Douglas Brown
(1952), Ewan Clague (1953), Clark Kerr (1954), Lloyd Reynolds
(1955), Richard Lester (1956), Dale Yoder (1957), E. Wight Bakke
(1958), William Haber (1959), and John Dunlop (1960). All of these
men had disciplinary backgrounds in economics (broadly defined), most
were of the ILE school (Yoder and Bakke were the closest to the PM
school; no one was a neoclassical economist), and all were ideologically
supportive of the New Deal system of collective bargaining (or at least
none went on record as opposing it).
Finally, the ILE orientation of the IRRA is indicated in the program
topics selected for the annual meetings. Of the eight to ten sessions at
the winter meetings during the 1950s, about two~thirds were devoted
to unionism and collective bargaining and labor legislation topics (the
two principal solutions to labor problems of the ILE school) and one~
fourth to topics of a more pure economics nature (e. g., wages and prices,
labor mobility). In some years the program included one session that
was devoted to a personnel or human relations topic, while in other
years no PM topics were included on the program.

FouNDING oF THE ILR REVIEW

Another significant event of the postwar period was the establishment
of the Industrial and Labor Relations Review, the first scholarly journal in
America devoted specifically to IR. Sponsored by the School oflndustrial
and Labor Relations at Cornell University, the journal appeared for the
first time in October 1947. Its editor was Milton Konvitz, a well~known
authority on labor law.

71
 Institutionalization of Industrial Relations

The Review had a significant influence on the field in that its editorial
policy (choice of paper topics, authors, and books to be reviewed) helped
define both the intellectual boundaries and center of gravity of industrial
relations. Like the IRRA, the Review clearly recognized that industrial
relations was multidisciplinary and addressed subject areas in both the
PM school (personnel management, human relations} and the ILE
school (labor-management relations, protective labor legislation}. This
fact was most clearly illustrated by the broad and relatively well-balanced
selection of books chosen for inclusion in the book review section.
The same balance was not achieved in the articles, however. Like
the papers in the proceedings of the IRRA, the great majority of the
papers published in the Review were written by economists and dealt
with trade unions, the process and outcome of collective bargaining,
labor legislation, and labor market issues. Of the twenty-six articles
published in the first four issues of the journal, for example, twenty dealt
directly with unions, collective bargaining, and labor legislation, while
only two pertained to personnel management or human relations topics
in nonunion workplaces.
To a significant degree the preponderance of ILE-related research was
a reflection of both the nature of the research being done at the time
and the choices authors made regarding the journals to which they
submitted articles, rather than any explicit editorial policy of the journal
itself. Labor unions and collective bargaining were, after all, the research
topics in the late 1940s, labor economists had historically represented
the largest disciplinary contingent in IR, and relatively little academic
research of intellectual substance was being done in personnel manage-
ment at that time. Likewise, most IR scholars in those PM-related fields
where significant research was taking place (e. g., human relations, in-
dustrial sociology, management, industrial psychology) submitted arti-
cles to journals in those fields rather than to the Review.
But the ILE tilt of the journal also reflected to some degree the
underlying value system of the School of Industrial and Labor Relations
and the editorial board of the journal. In the foreword to the first issue
of the Review, for example, Edmund Day (president of Cornell Uni-
versity} wrote, "The establishment of the Industrial and Labor Relations
Review is a logical extension of the function which higher education is
assuming in the area of labor-management relations." The use of the
term labor-management relations was important in that it immediately

72
 Institutionalization of Industrial Relations

narrowed the domain of research to one subset of industrial relations-

unionized employment situations. Likewise, it is instructive that Edwin
Witte was chosen to be the author of the lead article for the first issue.
(The title of his article was "The University and Labor Education.")
Finally, if the editorial board of the Review could find numerous books
on PM subjects to include in the book review section of each issue, one
must wonder why there were not at least a few PM-related articles.

73
 5
THE GoLDEN AGE OF
INDUSTRIAL RELATIONS

T HE "GOLDEN AGE" of the field of industrial relations spanned a

ten-year period from 1948 to 1958. 1 This period was the high
point for the field both because of the public attention given to
the subject of employer-employee relations and because of the quality
and volume of academic research on this topic. These favorable con-
ditions were reflected in a strong growth in student enrollments, a
continued increase in the number of IR programs, and, most important,
an unprecedented involvement in IR research by top-flight scholars from
a wide variety of academic disciplines. 2
The flowering of multidisciplinary industrial relations research in
American universities was the result of both intellectual developments
in the disciplines associated with industrial relations and the unsettled,
sometimes tumultuous state of labor-management relations in the na-
tion. The most important impetus for the widespread involvement in
industrial relations research by scholars from disciplines as disparate as
anthropology, law, sociology, economics, and psychology was the sudden
spread of unionism across the mass-production industries of the country
and the surge in strikes and labor violence that accompanied it. When
trade unions represented only a small proportion of the workers in a
handful of industries, the topic of unions and collective bargaining was
of sufficiently small social and economic significance that few scholars
other than labor economists gave it much attention.
The situation changed dramatically after World War II, however, as
unions organized more than half the work force in manufacturing, in-
dustry after industry experienced long and bitter strikes, and the public

75
 Golden Age of Industrial Relations

debate over the Taft-Hartley amendments to the Wagner Act heated

up to the boiling point. Suddenly, topics such as union growth, union
governance, the collective bargaining process, strikes, the impact of
collective bargaining on the management and performance of firms, and
the macroeconomic impact of collective bargaining on wages, prices,
and productivity were in the forefront of academic and public attention.
In response, a large number of scholars from not only economics but a
wide range of other disciplines were drawn into the study of industrial
relations.
The push of current events toward greater involvement in industrial
relations research was abetted by the pull of intellectual developments
in both the behavioral sciences and the field of management. The major
development that precipitated the participation of behavioral science
researchers was the emergence of the human relations movement,
spawned by the experiments at the Hawthorne plant of the Western
Electric Company in the late 1920s-early 1930s. (Recall that this move-
ment was distinct from the one that originated in the early 1920s among
personnel practitioners.) In the short run (pre-1960), the impact was
positive in that the human relations movement contributed to a sub-
stantially increased involvement in IR research by behavioral scientists,
thus strengthening not only interdisciplinary research but also the at-
tachment of those researchers to the field. Over the longer run, however,
the movement also contributed to the breakup of the PM and ILE
schools, an event that was to have very negative consequences for the
field.
To appreciate this sequence of events, one must understand the origins
and development of the human relations movement and the evolution
of thought in labor economics during the same period (1930-50).

THE HuMAN RELATIONS MovEMENT

The human relations movement emerged as a distinct area of academic
study and investigation in the late 1930s, reached a peak of influence
during a ten-year period stretching from roughly the mid-1940s to the
mid-1950s, and then went into decline, eventually to be absorbed by
the new field of organizational behavior in the early 1960s. The wide-
spread consensus is that the human relations movement (and the related
field of industrial sociology) was born as a result of the series of industri-
al experiments conducted at the Hawthorne, Illinois, plant of the West-

76
 Golden Age of Industrial Relations

em Electric Company from 1924 through 1932 (Miller and Form 1964;
Whyte 1965, 1987).
The Hawthorne experiments started as a straightforward exercise in
scientific management (Greenwood and Wrege 1986; Wren 1987). The
issue investigated was the impact of different levels of illumination on
worker productivity. The results, however, were quite surprising: the
rate of output of the workers in both the control group and the test
group increased regardless of the level of lighting.
In 192 7, the illumination tests at Hawthorne were replaced by a set
of experiments involving five relay assemblers. Initially, to establish a
baseline for comparison, the work performance of the assemblers was
monitored for two weeks in their regular department. They were then
isolated in a separate room with their own supervisors and observers.
Various changes in the work environment were introduced, such as
differences in the incentive pay system, the number of lunch breaks,
and the work hours. After a year of experimentation, all the work
conditions were returned to their original level. The results that emerged
baffled the company officials: the assemblers' productivity had increased
steadily over the year, and at the end of the experiments it was con-
siderably higher than at the beginning.
The assistant plant manager, George Pennock, presented these anom-
alous results to several faculty members at MIT and Harvard for their
analysis. Three of these people were Elton Mayo, T. North Whitehead,
and Fritz Roethlisberger, all of whom were in the industrial research
department at Harvard. (Two other faculty members of this department
also published significant work in human relations, George Homans and
Benjamin Selekman.) The professors found the results intriguing and
decided to conduct further investigations. One line of activity they
pursued was a large-scale interviewing program in which employees were
encouraged to tell a counselor what was on their minds. A second line
of investigation was the observance of the interpersonal and social dy-
namics of workers in a small-group setting. In this experiment, a small
group of bank wiring workers was isolated in a separate room and their
behaviors and interrelationships recorded. Unlike in the relay assembly
experiment, the supervisors and observers did not interact and become
friendly with the workers. Although the output of the relay assemblers
had increased significantly over the course of the experiment, the same
did not occur with the bank wiring workers. In fact, these workers

77
 Golden Age of Industrial Relations

deliberately restricted output through informal group norms and

sanctions.
The first extensive description and interpretation of the experiments
at Hawthorne was by Mayo in The Human Problems of an Industrial
Civilization, published in 1933. Six years later, Roethlisberger and Wil-
liam Dickson (chief of the employee relations research department at
the Hawthorne plant) published what is still considered a monumental
work on the Hawthorne experiments, their six hundred-page book Man-
agement and the Worker (1939). Both sets of writers identified several
general lessons to be learned from the experiments.
As they saw it, "a remarkable change of mental attitude" was the key
factor in explaining the increase in productivity of the relay assemblers
(Mayo 1933:71). The variations in the external work conditions, such
as the lighting, incentive rates, and rests, were, they believed, minor
influences on the work performance of the employees. Far more signif-
icant was the positive impact the experiments had on the psychological
state of the workers and the social environment of the shop. 3 An im-
portant finding, for example, was that the relay assemblers experienced
a significant increase in morale and interest in their job, attributable in
part to the friendlier, more relaxed style of supervision and the greater
opportunity to provide suggestions and feedback on the organization and
performance of their work.
The researchers reached another important set of conclusions from
the interview program; namely, that an employee's work performance
is significantly affected by his or her general emotional state and specific
attitudes or "sentiments" regarding work, the work environment of the
plant, and his or her coworkers and superiors. They found that these
sentiments are critically influenced by psychological and social relations
affecting the employee both inside and outside the plant and that these
relations (such as desiring to gain the social approval of workmates)
often lead to "nonlogical" forms of behavior (i.e., behavior that does
not maximize the economic gain of the individual), such as deliberate
restriction of output.
Finally, from the bank wiring room experiments, Mayo and his col-
laborators discovered that even the smallest workshop has a complex,
informal social system with a well-defined set of status hierarchies, rit-
uals, customs, norms of behavior, and sanctions. This social system,

78
 Golden Age of Industrial Relations

they found, exerts a powerful influence on the performance of work and

the tenor of workplace relations.
Roethlisberger and Dickson provided massive documentation of the
data collected from the Hawthorne experiments and drew a number of
implications from them. It was Mayo, however, who fashioned from
these implications an overarching theory or "world view" of man, the
nature of industrial society, and the successful integration of man into
society (Mayo 1945; Roethlisberger 1977). Further, it was Mayo's the-
ory, and the policy implications and social and political philosophy that
accompanied it, that proved to be the most controversial.
Mayo's point of view regarding industrial relations was grounded in
several fundamental tenets. He believed, for example, that people have
a strong emotional need to integrate themselves into a larger social
group to give purpose and structure to their lives. When such a social
order is absent, individuals develop emotional ills such as anomie (feel-
ings of disorientation and isolation), depression, and frustration. 4 As he
saw it, much of the waste and conflict in industry was attributable to
these psychological maladjustments, brought on by the disorganization
of traditional society because of rapid industrialization and the emer-
gence of a new social system based on competition and individualism
(the antithesis of a stable social structure). Accordingly, the route to
greater productivity and harmony in industry was to create a social
structure and set of human relations in the plant that fostered teamwork
or, in his words, "spontaneous collaboration" (such as he thought existed
among the relay assemblers) by providing workers with a sense of com-
munity and shared purpose and thereby eliminating the feelings of an-
omie, frustration, and so on. 5 The responsibility for unleashing the
spontaneous collaboration of workers rested, in Mayo's view, with man-
agement, for only the managerial elite in a capitalist society had the
power and authority to reshape the social environment of the workplace.
To do so, managers needed to abandon their preoccupation with tech-
nical skills and instead cultivate social skills, such as interpersonal com-
munication, effective leadership, and an understanding of worker
motivation and attitudes.
The work of the Harvard group provided a great stimulus to behavioral
science research in employer-employee relations for three reasons. First,
it seemed to provide considerable support for the view that psychological

79
 Golden Age of Industrial Relations

factors are important determinants of employee productivity and worker-

management relations. Although the earlier generation of human re-
lations writers (the practitioners of the 1920s) had given great weight
to the "human factor," it was only after the Hawthorne experiments
that detailed scientific evidence was advanced to support this proposi-
tion. Second, the Harvard group called attention to the important
impact of informal social organization and social interaction on pro-
ductivity and the tenor of workplace relations. The significance of the
social dimension of employer-employee relations was largely neglected
in the writings of the earlier generation of human relationists and thus
its discovery in the Hawthorne experiments represented a true advance
in knowledge. 6 Third, and finally, the Harvard group demonstrated the
relevance of anthropological and sociological research methods to the
problems of industry.
The publication of Management and the Worker in 1939, as well as
Mayo's book, precipitated great interest among both practitioners and
academics in the Hawthorne experiments and the new subject of human
relations. Interest was further fueled by the largely independent work
of Kurt Lewin on "group dynamics" (Roethlisberger 1977; Wren 1987).
Lewin, a psychologist who had been trained in Germany, came to the
United States in the 1930s and took a professorship at MIT. His research
focused on the behavior of individuals in small groups, a phenomenon
that he concluded was heavily influenced by social pressures and symbolic
interactions. His theory of group dynamics, and its applications to topics
such as organizational change and climate, was highly complementary
to the research findings of Mayo and the Harvard group and contributed
additional synergy to the development of human relations.
Because of these and other developments, human relations research
in American universities became a hot topic in the 1940s. Indicative
of this interest, several interdisciplinary university programs were created
to conduct human relations-style research. The first such unit was the
Committee on Human Relations in Industry at the University of Chi-
cago, created in 1943. The program was directed by W. Lloyd Warner,
an anthropologist. 7 Other members included Burleigh Gardener and
William Foote Whyte, both sociologists. Whyte later (1948) moved to
the School of Industrial and Labor Relations at Cornell and became the
leading voice in industrial relations of the human relations school.
Another important institutional development was the creation in

80
 Golden Age of Industrial Relations

1944 of the Labor and Management Center at Yale University. The

center was a unit of the Institute of Human Relations and was under
the directorship of E. Wight Bakke, a sociologist turned economist. This
eclectic background helped Bakke establish an interdisciplinary research
record that was an exemplar in industrial relations. One of Bakke's
major collaborators at the center in the 1950s was Chris Argyris, author
of the influential book Personality and Organization (1957) and a major
contributor to the development of the field of organizational behavior.
Yet another important behavioral science research center was the
Research Center for Group Dynamics at MIT, established by Kurt Lewin
in 1945. After Lewin's death in 1947, the center was moved to the
University of Michigan, where it continued to sponsor important re-
search in group training (T-groups) and organizational change.
Michigan was also home to the Institute for Social Science Research,
established in 1946 by Rensis Likert, a psychologist. The institute pi-
oneered in the collection and analysis of attitudinal data, while Likert
became one of the foremost advocates of participative management. His
pathbreaking book on the subject was The Human Organization (1967).
The human relations movement was at the apogee of its influence
and prestige for roughly a ten-year period beginning in the late 1940s
and extending to the late 1950s. Research in human relations proceeded
along several fronts as a result of both the emergence of various theo-
retical subschools within human relations and the diverse disciplinary
backgrounds of the people involved. 8 The psychologists, for example,
were heavily involved in studies of the determinants of employee morale
and motivation (Maslow 1954; Herzberg, Mausner, and Snyderman
1959; McGregor 1960) and leadership styles and effectiveness (Lewin,
Lippitt, and White 1939; Tannenbaum and Schmidt 1958; Likert 1961);
the management theorists examined the conflicts between employees'
psychological needs and work in large organizations (Argyris 1957); the
sociologists examined bureaucracy in business firms (Gouldner 1954),
social hierarchies, and relations in offices and factories (Gardner 1946;
Whyte 1948), and workers' adaptation to assembly-line production
methods (Chinoy 1952); while the anthropologists investigated patterns
of human interaction (Chapple 1949, 1952) and the development of
social systems in factories (Warner and Low 1947).
The initial wave of human relations research largely bypassed the
subjects of trade unionism and collective bargaining, in part because

81
 Golden Age of Industrial Relations

the Hawthorne experiments had taken place in a nonunion plant. This

omission generated considerable criticism (e.g., Hart 1948; Bendix and
Fisher 1949), which in tum precipitated psychological and sociological
studies on various aspects of labor-management relations, including in-
dustrial conflict (Homans and Scott 1947; Whyte 1951b; Kornhauser
1954; Dubin 1960), the dynamics of labor-management relations at the
plant and company level (Bakke 1946; Harbison and Dubin 1947), the
leadership and internal dynamics of union locals (Sayles and Strauss
1953), and the role of psychological factors in the bargaining process
(Stagner 1948; Haire 1955).
In the academic world, human relations represented a new and distinct
area of study vis-a-vis personnel management. The former was more
theoretical and research-oriented and focused on the underlying deter-
minants of individual and group behavior in the workplace, while the
latter had a heavy vocational orientation and emphasized specific tech-
niques and practices useful to various personnel tasks such as employee
selection, compensation, and performance appraisal. Human relations,
therefore, was more intellectually substantive than personnel manage-
ment and, consequently, was held in higher professional esteem. 9
At the time, human relations was widely seen as a subfield of industrial
relations and part of the PM school. Elton Mayo, in tum, was widely
regarded as the intellectual father of human relations and thus one of
the preeminent figures in industrial relations. Because these links be-
tween Mayo, human relations, and industrial relations are often slighted
in present-day discussions of IR theory and research, it is worth docu-
menting them more thoroughly.
There are several compelling pieces of evidence that Mayo's contem-
poraries considered him a participating member of the field of industrial
relations. For example, in 1928, Harvard University invited Mayo to
present a lecture as part of its recently created Wertheim Lectures on
Industrial Relations. His paper (Mayo 1929) was published with five
others, including one by John R. Commons. Mayo's connection to
industrial relations was reaffirmed two years later when the Harvard
Business School published his article "A New Approach to Industrial
Relations" (Mayo 1930), which described the Hawthorne experiments
then under way. 10 Two other testimonials to Mayo's influence on in-
dustrial relations are a statement in Fortune (1946:181)-"0ne of the
most challenging views in the turbulent field of industrial relations today

82
 Golden Age of Industrial Relations

is held by Elton Mayo .... Indeed, many believe that Mayo holds the
key to industrial peace"-and a claim in Time (1952:96) that Mayo was
"the father of industrial human relations." Finally, the first sentence in
a biography of Mayo (Trahair 1984:1) states, "George Elton Mayo pi-
oneered in the field of industrial human relations and for that work
deserves a place in business history."
Considerable evidence also indicates that human relations was com-
monly perceived to be a subfield of industrial relations by people in both
the PM and the ILE wings of the field. In a review article on individual
and group behavior in organizations, for example, Conrad D. Arensberg
(1951), a leading behavioral science researcher, discussed three com-
monly used names to describe this area of research-human relations,
industrial sociology, and industrial psychology-and rejected all three
as unduly narrow in perspective. He went on to state (p. 330), "The
best common description of the field, then, is the historical one: sci-
entific study of the sources of unrest in labor and management relations,
that is, the study of the problems of industrial relations" (emphasis added).
Looking at the subject from an ILE perspective, labor economist
Lloyd Reynolds (1948:285) stated: "The problems [of human relations
in industry] range over the whole field of labor and industrial relations .
. . . The phrase "human relations in industry" connotes not a separate
subject matter speciality, but a different point of view and method of
approach. In a later article, Reynolds (1955:2) amplified on this theme:
"The study of industrial relations needs to be conceived in very broad
terms. People concerned with curriculum construction are perhaps forced
to draw fine lines between 'industrial relations,' 'labor relations,' 'labor
economics,' 'human relations,' 'personnel management' and so on. This
fragmentation should not veil the fact that we are integrally involved
in all the phenomena surrounding the use of human effort in
production."
The IRRA's 1957 research volume, Research in Industrial Human Re-
lations (Arensberg et al.), provides additional evidence. The editors state
in the preface (p. vii) that "human relations in industry has become
both the label of a group of studies of people at work and the slogan of
a movement of thought and action in American industrial relations."
Finally, one of the branches of IR's intellectual family tree, shown
in figure 3-1, is the human relations movement (what Form and Miller
labeled the "Harvard Graduate School of Business"). 11

83
 Golden Age of Industrial Relations

LABOR EcoNOMics: FRoM LABOR PRoBLEMS

TO LABOR MARKETS
The emergence of the human relations movement strengthened the
PM side of IR research considerably. A similar transformation in the
field of labor economics had equally far-reaching consequences for the
ILE school.
In the 1920s and 1930s, the emphasis in the field of labor economics
was far more on the first word of the term than on the second. Thus,
the text Labor Economics, the first book to use the term in the title,
published in 1925 by Solomon Blum (McNulty 1980:127), contained
twenty-one chapters, seventeen of which were devoted to labor legis-
lation, labor unions, and collective bargaining. The other four were on
the more economics-related subjects of the business cycle, wage theories,
unemployment, and the mitigation of unemployment. The presentation
was entirely descriptive (no demand-supply diagrams were used), was
critical of orthodox (neoclassical) theory, and was generally supportive
of collective bargaining and protective labor legislation. 11
Blum had a broadly institutional perspective on labor economics that
was not only critical of orthodox theory and the operation of free markets
but also heavily interdisciplinary in its approach. As Blum's book ex-
emplifies, labor economics in this period was largely estranged from its
mother discipline and had as much in common with law, history, and
sociology as with economics per se. 13 This difference in perspectives, in
tum, led to a considerable rift between the institutional labor economists
and the neoclassical theorists, who dominated much of the rest of the
discipline.
The neoclassical school was the more narrowly construed in that it
took the institutional structure of the economy as a "given" and focused
instead on the operation of markets, used deductive logic to derive
a large body of formalized economic theory to explain the operation
of markets (e.g., marginal utility and marginal productivity theory, sup-
ply and demand curves), generally assumed markets operated in a com-
petitive and efficient manner, and thus arrived at policy conclusions
that favored minimal government or trade union intervention in the
economy.
The institutionalists looked with disdain on the work of the theorists
because, they claimed, it was based on a set of assumptions that were
manifestly at odds with reality and thus led to incorrect explanations

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or predictions of economic phenomena and pernicious policy conclu-

sions. In contrast, the neoclassical theorists claimed that the institu-
tionalists did not understand economic theory and thus that their
criticisms were either misdirected or mistaken and that their economic
analysis was not a scientific endeavor per se but a thinly veiled attempt
to provide a justification for trade unions and government intervention
in the economy.
Partly in reaction to the neoclassical critics, Commons attempted to
develop a theoretical base for institutional economics. His major efforts
in this regard were two books, The Legal Foundations of Capitalism ( 1924)
and Institutional Economics (1934b). As noted in chapter 3, neither of
these books had much impact on the field, in part because few economists
could understand what he was trying to say and in part because his
theoretical framework was so expansive that it went far beyond the
bounds of economics as most people perceived the subject. 14 Not only
was Commons unsuccessful in developing institutional theory, but so
were his students and other institutional labor economists of the period.
The field of labor economics in the 1930s was thus largely isolated
from its mother discipline. 15 This situation began to change late in the
decade with the entrance into the field of a new generation of labor
economists (McNulty 1980; Kaufman 1988, 1993; Kerr 1988). Impor-
tant names among this new generation were John Dunlop, Clark Kerr,
Richard Lester, Lloyd Reynolds, Arthur Ross, and Charles Myers. 16
These economists turned labor economics away from a historical, de-
scriptive analysis of labor problems and toward an analytical study of
labor markets. 17 They were clearly in the neoclassical tradition in that
they sought to refashion labor economics so that it would more nearly
resemble other areas of economic analysis. At the same time, they
continued to have many links with the institutionalists, particularly in
their use of the case study, inductive method of research; their focus on
the pervasiveness and importance of imperfections in the labor market;
their favorable view of collective bargaining and protective labor leg-
islation as ways both to offset employer market power and to introduce
industrial democracy into the workplace; their belief in the social and
economic efficacy of pluralism; their skepticism of the microeconomic
model of the firm (particularly the profit-maximization assumption); and
their desire to broaden economic theory beyond the study of market
forces by bringing in nonmarket considerations from other disciplines. 18

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 Golden Age of Industrial Relations

Three major events shaped this blend of perspectives. The first was
that these economists had received a heavier dose of economic theory
in their doctoral studies than had the earlier generation of institution,
alists. Much of this theory was imported from England, which up to
that time had produced far more able economic theorists than had the
United States. Doctoral students in economics, for example, were re,
quired to master Alfred Marshall's Principles of Economics (1920), a
pioneering text that developed the competitive model of demand and
supply in product and factor markets, albeit with numerous qualifications
to take into account institutional realities. (Calculus was used in foot,
notes and appendixes). Another required text for labor students of the
1930s was John R. Hicks's The Theory of Wages (1932). This book was
an exact antithesis to institutional works such as Blum's Labor Economics
(1925) in that Hicks applied neoclassical competitive theory thoroughly
and unflinchingly to the labor market. Hicks (particularly in chapter 1)
largely omitted the qualifications Marshall thought were important on
the grounds that they had little impact in the long run on the pattern
of wages and employment. Other important English contributions to
economic theory in the 1930s were Joan Robinson's The Economics of
Imperfect Competition ( 1933), which developed models of imperfect com,
petition, such as monopsony (one buyer of labor) and oligopsony (several
buyers of labor), and J. M. Keynes's The General Theory of Employment,
Interest, and Money (1936), which purported to show that the macro,
economy could become mired in an underemployment equilibrium.
The second event that significantly influenced these labor economists
was the Great Depression (Kerr 1988; Reynolds 1988). The Depression
seemed to provide overwhelming evidence that the market mechanism
did not work as effectively or as automatically as predicted by competitive
theory. According to competitive theory, wages and prices are supposed
to rise and fall to maintain an equilibrium between demand and supply.
The assumption is that if people remain unemployed for long, it is
through choice or laziness. For the new generation of labor economists,
the persistence of mass unemployment during the 1930s, and the large,
scale human suffering that accompanied it, were convincing evidence
that the cause of the unemployment problem was defects of the market,
not defects of the unemployed.
Another development of the Depression years that influenced their
perspective was the surge in union membership and the spread of in,

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 Golden Age of Industrial Relations

dustrial unionism. As collective bargaining replaced individual bargain,

ing across a wide swath of American industry,· it seemed clear that
institutional forces were increasingly supplanting market forces as de-
terminants of wages, hours, and conditions of employment.
The third event that fundamentally shaped the research and policy
perspective of this new generation of labor economists was their in-
volvement during World War II in the wage stabilization and dispute
resolution activities of various government agencies, most particularly
the War Labor Board (WLB). Dunlop, Kerr, Lester, Reynolds, and
others were plucked from their academic jobs and assigned leading ad-
ministrative and research positions with various branches of these or-
ganizations. Their jobs intimately involved them in the process of wage
determination and collective bargaining, for a principal activity of the
WLB was controlling wages to prevent wartime inflation and resolving
disputes over wage differentials and wage increments that might provoke
work stoppages and threaten war production. The immersion of these
young academics in the real-world operation of unions, firms, and labor
markets profoundly affected their approach to labor economics after they
returned to academe at the end of the war (Kerr 1988). They began to
question the relevance of orthodox competitive theory (such as con-
tained in Hicks's The Theory of Wages [1932]), for labor markets seemed
to operate with considerably less efficiency, and collective bargaining
with considerably less harm, than standard theory predicted (Kerr 1950;
Lester 1951). The experience also impressed upon them the need to
make economic theory more realistic by broadening it beyond a narrow
study of supply and demand in competitive markets (Dunlop 1944:5).
It also stimulated their interest in public policy issues related to labor.
After the war, many of the new generation of labor economists began
to produce a great volume of research on labor markets and collective
bargaining. This research was distinctive in that it represented a will-
ingness and an ability to develop and use economic theory, a focus on
the operation of labor markets, a skepticism of the ability of competitive
theory to explain labor market outcomes such as wage differentials and
weekly hours of work adequately, and a desire to broaden economic
analysis of the labor market to include social, psychological, and insti-
tutional conditions. 19
The hallmark studies of this era were Dunlop's Wage Determination
under Trade Unions (1944), Arthur Ross's Trade Union Wage Policy

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 Golden Age of Industrial Relations

(1948), several studies by Lester on wage diversity (1946b, 1952), Kerr's

article (1954a) "The Balkanization of Labor Markets," Reynolds's New
Haven labor market study The Structure of Labor Markets (1951), and
the local labor market study by Charles Myers and George Shultz ( 1951).
The message of these and other studies was severalfold: the structure of
wages in nonunion labor markets diverges significantly from the level
predicted by competitive theory; labor markets contain significant im-
perfections such as limited information and restrictions on worker mo-
bility that provide employers with market power over wages; firms do
not always maximize profits; collective bargaining often is benign or
even helpful in its impact on economic efficiency; and quite apart from
economic efficiency, collective bargaining is desirable because it provides
industrial democracy and due process in the workplace.
Given the institutional nature of labor economics, until the late
1930s, the academic study of industrial relations and labor economics
were closely intertwined. With the rise of the new generation of labor
economists and the reorientation of the field from labor problems to
labor markets, industrial relations and labor economics began to grow
apart and develop distinct intellectual identities. The ties between labor
economics and industrial relations remained close, however, and labor
economics continued to be the dominant source of intellectual inspi-
ration for academic IR. This was partly because of the continued influ-
ence of the institutional tradition in labor economics and partly because
of the dual interests of the new generation of labor economists and their
uneasy relationship to the broader discipline of economics. This latter
reason requires additional discussion.
Although the new labor economists were trained as economists and
published a wide range of research on labor economics subjects, they
were also seriously interested in the field of industrial relations. Indeed,
as we have seen, many of the directors of the new IR institutes and
centers were labor economists from this group, as were the prime movers
in the establishment of the IRRA. In effect, these economists had dual
intellectual interests-the operation of labor markets (labor economics)
and the study of employer-employee relations (industrial relations). 20
They were able to straddle this intellectual divide successfully because
their perspective on the operation of labor markets, and the policy
conclusions derived therefrom, dovetailed with the ILE perspective in

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 Golden Age of Industrial Relations

industrial relations on how best to resolve labor problems and promote

improved employer-employee relations.
While the new labor economists started out as economists first and
became committed to industrial relations only later, it is clear from their
research record and professional activities that by the late 1950s indus-
trial relations had become their de facto home. 21 Important in this
process was the hostile reception their research and policy program
received from neoclassical price theorists, with the result that many of
the new labor economists felt a sense of estrangement and alienation
toward the economics discipline. When the new labor economists started
their careers, they perceived themselves as neoclassical reformers in that
they used the Marshallian model of demand and supply as their basic
theoretical tool but sought to broaden it to take into account the market
imperfections and noneconomic factors that Hicks had omitted from
The Theory of Wages (Kerr 1988). To their dismay, not only was their
effort at revisionism poorly received by the "ruling elite" in economics
(microeconomic price theorists), but it was frequently dismissed with
contempt as "mere sociology" (Reynolds 1988). A defining moment in
this regard was the publication of Lester's (1946a) article "Shortcomings
of Marginal Analysis for Wage-Employment Problems" in the American
Economic Review. Lester's article attacked the relevance of the marginal
analysis contained in neoclassical theory to explain the determination
of wages and employment levels. The hostility of the theorists was
evident in the counterreplies by Fritz Machlup ( 1946) and George Stigler
(1947), who conceded nothing to Lester and argued instead that either
he did not understand the implications of neoclassical price theory or
his data did not prove what he claimed it did. 22
Differences in policy perspectives furthered the rift between the neo-
classical price theorists and the new group of labor economists. The new
labor economists were generally predisposed to favor collective bargain-
ing and protective labor legislation such as the minimum wage (Lester
1947a; Reynolds 1957, 1988). Their position was built on the view that
nonunion labor markets contain imperfections that give employers some
market power over wages and introduce numerous distortions and in-
equities into the wage structure. Collective bargaining and minimum
wage laws, therefore, were seen as useful checks to employer power, a
spur to efficient production and improved management methods, and a

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 Golden Age of Industrial Relations

vehicle for increased workplace equity. The neoclassical theorists (e.g.,

Stigler 1947; Simons 1948; Lindblom 1949; Machlup 1951), in contrast,
took a decidedly negative view of the role and impact of unions and
minimum wage laws. Starting from the presumption that labor markets
are highly competitive, they argued that unions are a monopolistic source
of inflated wages and reduced productivity, while protective labor laws
such as the minimum wage not only reduce allocative efficiency in the
economy but hurt, rather than help, low-wage workers because of the
reduced employment opportunities that result. 23
Because of these differences in outlook, and the professional antag-
onisms they engendered, the new labor economists came to feel that
they were not entirely welcome or accepted in economics proper and
that their research and point of view would not get a fair hearing in
the American Economic Association. Thus, in the late 1940s and early
1950s, the new labor economists became involved in industrial relations,
first, because they had a genuine interest in the subject and, second,
because the field provided a natural focal point for them to discuss and
pursue their more institutionally oriented research. These motivations
had much to do with the founding of the IRRA. 24 It was not coinci-
dental, for example, that shortly after his rebuff by Stigler and Machlup
Lester took the lead in organizing the association. The function of the
IRRA as a haven for the new labor economists is also revealed in the
preponderant number of institutionally minded labor economists who
later served as president of the organization, the disproportionate number
of session topics at the annual meeting devoted to economics-related
topics, and the fact that its annual meeting was held at the same time
and location as the annual meeting of the American Economic As-
sociation.
There are clearly several parallels between the development of labor
economics and of human relations. Both fields had intellectual ante-
cedents in the 1920s and 1930s but emerged in the early 1940s as distinct
subject areas with articulated theoretical frameworks and intellectual
boundaries. Both fields also developed a strong affiliation with industrial
relations, human relations with the PM wing of the field, labor eco-
nomics with the ILE wing. The major difference was that the labor
economists had been more actively involved and more widely repre-
sented in the academic arena of industrial relations before World War
II than had the behavioral scientists. Coupled with the surge in interest

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 Golden Age of Industrial Relations

in unions and labor,management relations after the war, this placed the
labor economists in the position to become preeminent in the field during
its golden age, in the late 1940s and 1950s.

RESEARCH IN THE GoLDEN AoE

The confluence of current events and intellectual developments out,
lined above resulted in an unprecedented outpouring of industrial re,
lations research in the 1950s. Noteworthy aspects of theIR research of
the period include its volume, disciplinary breadth, and interdisciplinary
character.

VOLUME
Industrial relations was without doubt one of the boom areas of re,
search in the social and behavioral sciences in the 1950s. Whereas a
computer search for the period 1930-39 turned up only fifteen published
works with industrial relations in the title, a similar search for the years
1950-59 produced more than sixty. And if one defines industrial rela,
tions to include any subject related to the employer,employee relation,
ship, the number of entries is huge. Adding articles published in
academic journals and proceedings only reinforces this conclusion, in
part because in the 1950s periodicals such as the ILR Review and the
IRRA proceedings were devoted exclusively to IR research, whereas in
the 1930s no such publications existed.

BREADTH
Equally impressive is the disciplinary breadth of the IR research of
the 1950s. Economics was heavily represented, of course. The doyens
were Sumner Slichter and Edwin Witte. Among the younger generation
of economists, several economic theorists (e.g., Paul Samuelson, Milton
Friedman, Fritz Machlup, Edward Chamberlain) made contact with the
field, as well as a host of labor economists. The labor economists were
themselves a heterodox group, represented on one end by people who
were more management or union specialists than economists per se (e.g.,
George Strauss, Frederick Harbison, Milton Derber, George Taylor,
James Healy, Dale Yoder), on the other end by people who were applied
price theorists and statisticians (H. Gregg Lewis, Martin Bronfenbren,
ner, Melvin Reder, Gary Becker). In the middle was a large group (John
Dunlop, Clark Kerr, Richard Lester, Lloyd Reynolds, Arthur Ross,

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 Golden Age of Industrial Relations

Charles Myers, Neil Chamberlain, Albert Rees, Lloyd Ulman, Joseph

Shister) who combined both perspectives.
Industrial relations also attracted a large number of researchers from
other fields, most notably a group associated (some more loosely than
others) with the human relations movement. In addition to the intel-
lectual godfather of the group, Elton Mayo, there were anthropologists
(Conrad Arensberg, Eliot Chapple, Lloyd Warner), psychologists
(Douglas McGregor, Arthur Kornhauser, Daniel Katz, Mason Haire,
Frederick Herzberg, Ross Stagner, Harold Leavitt, Chris Argyris), and
sociologists (George Homans, William Foote Whyte, Burleigh Gardner,
Melville Dalton, Harold Wilensky). 25 Industrial relations also attracted
other noneconomists who were outside the human relations movement,
including sociologists (e.g., Reinhard Bendix, Herbert Blumer, Robert
Dubin, C. Wright Mills, Wilbert Moore) from the structural-functional
school (a school of thought in sociology that was generally hostile to
the small-group, internally oriented perspective of human relations),
academics from administrative science and management (Peter Drucker,
Herbert Northrup), history (Irving Bernstein), law (Benjamin Aaron),
political science (Lloyd Fisher, Seymour Lipset), and personnel (Donald
Paterson).
As a result of this extensive multidisciplinary involvement, IR re-
search had unprecedented breadth in its topic areas, theoretical per-
spectives, and research methods. 26 A remarkable but almost completely
ignored publication by Harold Wilensky (a sociologist and research as-
sociate at the IR center at the University of Chicago) entitled Syllabus
of Industrial Relations (1954) is the best evidence of this breadth. Wil-
ensky states that the purpose of the syllabus is to offer a "road map" for
the study of the field of industrial relations, which he subdivides into
five principal areas of study: the characteristics and direction of devel-
opment of urban industrial society; the organization of work in industrial
society (including labor markets and the management of human re-
sources); trade union history, organization administration, and impact;
collective bargaining systems, processes, and issues; and public policy. 27
Wilensky then provides a three hundred-page overview of the relevant
research and research issues in each of these areas. The expansive nature
of industrial relations research as of the mid-1950s is indicated by the
names of the academic journals Wilensky cites: Applied Anthropology,
American Economic Review, American Journal of Sociology, Harvard Busi-

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 Golden Age of Industrial Relations

ness Review, Human Organization, Industrial and Labor Relations Review,

Journal of Applied Psychology, Personnel, and Social Forces.

INTERDISCIPLINARY CHARACTER
The primary intellectual justification for the creation of the IR schools
and institutes, as noted previously, was the belief that the study and
resolution of labor problems would be materially enhanced by a collab-
orative, integrative research design that would draw upon methods and
ideas from the various disciplines related to the employment relation-
ship. Using three different approaches, IR scholars in the 1950s made
considerable attempts to practice this precept.
The first approach was to conduct cross-disciplinary research; that is,
research performed by a person trained in one discipline on a subject
traditionally examined by scholars in a different discipline. Several econ-
omists, for example, examined aspects of management, such as the
impact of collective bargaining on the practice of management (Cham-
berlain 1948; Slichter, Healy, and Livemash 1960) and specific per-
sonnel problems such as job evaluation (Kerr and Fisher 1950) and
recruitment and hiring methods (Lester 1954). Among the most notable
efforts in this regard were Herbert Simon's book Administrative Behavior
(1947) and E. Wight Bakke's Bonds of Organization (1950) and The
Fusion Process (1953). Several noneconomists also crossed disciplinary
lines. Examples include William Foote Whyte's study of incentive wage
systems and employee productivity (1955), Lloyd Fisher's study of the
harvest labor market (1953), and articles by Robert Dubin (1949) and
Benjamin Selekman and Sylvia Selekman (1950) on the impact of col-
lective bargaining on productivity.
The second approach was to select a particular IR topic and then
commission a series of research articles on it by scholars from a wide
range of disciplines, with the intent of encouraging a melding of ideas
and perspectives. One example is the book Industrial Conflict (1954),
edited by Arthur Kornhauser (psychology), Robert Dubin (sociology),
and Arthur Ross (economics). It contained contributions from more
than thirty other scholars, including many of the most prominent par-
ticipants in industrial relations from economics, sociology, psychology,
history, and law. Another noteworthy example is the volume Causes of
Industrial Peace (Golden and Parker 1955), a series of case studies of
collective bargaining relationships sponsored by the National Planning

93
 Golden Age of Industrial Relations

Association and written by a heterogeneous group of academics and

practitioners.
The third and most ambitious approach was for an interdisciplinary
team of researchers to carry out a research project. The exemplar of
such research is the two-volume series Labor-Management Relations in
Illini City (Derber et al. 1953), a joint effort by three economists, three
sociologists, and two psychologists. The Illini City study is noteworthy
in two respects; first, because it remains the most thorough attempt in
American industrial relations to conduct truly interdisciplinary research
and, second, because it produced such meager returns relative to the
massive work that went into it. 28 Although there were several project-
specific reasons for this disappointing outcome, many researchers never-
theless viewed it as a sobering lesson on the inherent limitations and
pitfalls of the interdisciplinary approach (see Derber et al. 1950; Derber
1967).
Another example of team research that had at least a quasi-
interdisciplinary representation of scholars was the book Industrialism
and Industrial Man by Clark Kerr, John Dunlop, Frederick Harbison,
and Charles Myers (1960). The 1950s saw a boomlet in international
and comparative IR research, particularly cross-national patterns of in-
dustrial relations practices and comparisons of IR structures and out-
comes in developed and less developed countries. 29 The most important
impetus behind this burst of research was the creation of the Inter-
University Study of Labor Problems in Economic Development project.
The project was initiated and organized by Kerr, Dunlop, Harbison, and
Myers (all were economists, although Myers and Harbison had consid-
erable expertise in the management area) and financially supported by
the Ford Foundation. Twelve books and more than twenty articles were
published during the 1950s under the project's auspices, with contri-
butions from academics across a wide range of disciplines. The most
notable of these studies was Industrialism and Industrial Man ( 1960), by
the four project leaders. The heart of the book is a cross-country com-
parison of the impact of the industrialization process on labor market
institutions, the work force, managerial elites, the "rule makers" in
society, and the nation's culture and value system. The central conclu-
sion is the "convergence hypothesis"; namely, that as nations develop,
the imperatives of the industrialization process are such that the basic
features of their social, economic, and political systems converge to a

94
 Golden Age of Industrial Relations

common standard (e.g., an open and mobile society, a reduced level of

worker protest and class conflict, increasing government involvement
in the labor market).
The book generated considerable professional attention in industrial
relations when it was first published, and the authors hoped that it would
chart a new direction for research in the field. This hope, as discussed
more in the next chapter, has been largely unrealized. The convergence
hypothesis, however, remains an actively debated subject, although
more in sociology than in industrial relations (see Form 1979; Gold,
thorpe 1984). 30

THE BATTLE OVER HuMAN RELATIONS

The research trends discussed above reflected the influence of various
centripetal forces that were working to bring together and integrate the
various disciplines associated with industrial relations. Unfortunately,
centrifugal forces were also at work that were simultaneously weakening
the bonds of association among the disciplines. The most visible was
the "spectacular academic battle" (Landsberger 1958:1), which devel,
oped during the 1940s and 1950s between the proponents and critics
of the human relations approach to industrial relations-a division that
corresponded closely to the historic division of the field into the PM
and ILE schools.
The critics of human relations came primarily from economics and
sociology, although a few were from political science and other fields.
Human relations found few defenders among economists, and labor
economists Clark Kerr and John Dunlop, the most influential members
of the ILE school in the 1950s, were two of the most outspoken critics.
While economists were generally united in their opposition to human
relations, industrial sociologists were deeply split. One group, what Kerr
and Fischer (1957) identified as the "plant sociologists" and Miller and
Form (1980) identified as the "interactionists," were among the most
vocal proponents of human relations. Members of this group included
William Foote Whyte and George Homans. Another group, identified
by Miller and Form as "structuralists," were critics of human relations.
Included in this group were Herbert Blumer, C. Wright Mills, and
Wilbert Moore.
The critics attacked the human relations approach on a variety of
grounds (see Bell 1947; Blumer 1948; Mills 1948; Bendix and Fisher

95
 Golden Age of Industrial Relations

1949; Dunlop 1950; Barkin 1950; Kerr and Fisher 1957; Roethlisberger
1977). Among the more important reasons were that human relations
research neglected the influence on IR outcomes of external economic,
social, political, and technological conditions and overemphasized the
influence of internal social and psychological factors; not only were the
independent variables used in human relations research (e.g., senti-
ments, patterns of interaction, leadership styles) likely to have a small
quantitative effect on the dependent variable, but many were not in-
dependent in a causal sense and represented dependent or intervening
variables; the model of man assumed in human relations research was
fundamentally flawed because it overemphasized the role of nonlogical
sentiments, feelings of anomie, and needs for stability and group be-
longingness; the development of a competitive, individualistic society
did not threaten social and economic disorganization but rather pro-
moted political freedom and economic growth; human relations under-
played conflicts of interest between workers and managers and promoted
the manipulation of workers to achieve management's profit objectives;
and human relations was anti-union in spirit and practice.
Several proponents of human relations rebutted the critics and pointed
out the weaknesses of the economists' approach to the study of industrial
relations (see Arensberg 1951; Whyte 1950, 1959; Arensberg and Too-
tell 1957). Among their major points were that human relations did
not ignore variations in external environmental conditions but, rather,
took this variation as a "given" and then proceeded to analyze how the
internal social system of the plant adjusted; the internal psychological
and social factors stressed in human relations research had a far larger
impact on IR outcomes than the critics admitted, in part because the
technological and economic system allowed managers significant dis-
cretion in how they organized work and managed the work force; econ-
omists' theories of industrial relations treated unions and firms as
organizational "black boxes" and hence were unable to specify the link
by which variations in external conditions give rise to specific IR out-
comes; the economists' model of rational, individualistic behavior was
seriously in error because it neglected the social dimension of work and
the role played by custom, ritual, symbols, group norms, and sanctions;
much of the criticism of human relations was fundamentally misdirected
because it was aimed at specific hypotheses or positions staked out by
Mayo and his close followers and that many human relationists later

96
 Golden Age of Industrial Relations

abandoned or never subscribed to in the first place; and while the aim
of human relations was to promote increased employee job satisfaction
and cooperation between workers and managers, this did not mean that
human relations was inherently anti-union, for its proponents recognized·
that unions protected employees' vital interests and helped promote a
stable social order in the plant.
The debate over human relations had both positive and negative
repercussions for the field of industrial relations. On the positive side,
the debate encouraged an interchange of ideas between researchers in
the various disciplines related to industrial relations, thus helping to
break down the walls that separated the economists from the sociologists,
the sociologists from the psychologists, the psychologists from the his-
torians, and so on. It also suggested the outlines for a theoretical com-
promise or modus vivendi between the "externalists" of the ILE school
and the "internalists" of the PM school.
The nature of this compromise was most clearly spelled out by Charles
Myers (1955:46) in a chapter of the book Causes of Industrial Peace in
which he attempted to summarize and synthesize the conclusions of
several authors such as Clark Kerr, John Dunlop, and Douglas McGregor:

In the preceding chapters we have seen how favorable external envi-

ronmental factors give to management and the union an opportunity
to develop peaceful relationships; and how certain attitudes, ap-
proaches, policies, and procedures make it possible to achieve these
relationships in specific situations.... Environmental factors ... do not
by themselves cause peace. A favorable combination of various envi-
ronmental factors make it easier for management and the union to
achieve a mutually agreeable and noncollusive peaceful relationship,
but the parties still have to desire peace and work to achieve it....
Environmental factors ... largely establish a range within which man-
agement and the union can largely determine their own relationship.

The compromise Myers offered provided a role to both the external

environmental factors emphasized by the ILE school and the internal,
social, and psychological factors emphasized by the PM school. In effect,
Myers said that environmental factors (e.g., economic conditions, the
body of labor law, prevailing social norms) determine the context in
which labor-management relations are conducted and place certain
bounds on the outcomes, but within these bounds the precise outcomes

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 Golden Age of Industrial Relations

are a function of the policies, practices, attitudes, and human relations

practices of the parties involved.
Unfortunately, neither the ILE nor the PM school took this com-
promise position to heart. Of the two protagonists in the battle over
human relations, the ILE group was the harshest and most uncompro-
mising in its attack on the other. This, in tum, led to the major negative
repercussion of the battle over human relations: it seriously exacerbated
the intellectual and ideological frictions and antagonisms that separated
the members of the PM and ILE schools, heightening the sense among
the former that they were not entirely welcome in industrial relations.
As documented earlier in this chapter, in the late 1940s-early 1950s,
the human relations group perceived that they had an intellectual af-
filiation with the field of industrial relations. A decade later, however,
it is equally clear that their links to industrial relations had weakened
significantly. As detailed in the next chapter, the disengagement of the
PM school from industrial relations occurred for a variety of reasons.
Clearly, one contributing reason was the intensity and uncompromising
nature of the ILE attack on the human relations program.
Dunlop and Kerr, as well as other leading figures of the ILE wing of
the field, were highly critical of human relations for both scientific and
policy and ideological reasons. From a scientific point of view, they
strongly objected to what they regarded as the almost complete neglect
of external environmental factors in human relations research and the
corresponding overemphasis on internal social and psychological factors.
Dunlop (1950:384) stated this position as follows:

Attention to the internal communications systems of an organization,

or the interaction of such systems between unions and managements
in collective bargaining, without frequent resort to the environmental
setting, can have only limited use as an explanation for industrial
relations behavior. From this vantage point the human relations ap-
proach must be cut to size-to a minor role-in any full explanation
of industrial relations behavior. 31

The proponents of the ILE school also had fundamental disagreements

with the human relations movement on matters of policy and ideology.
Dunlop and Kerr, for example, had a strong philosophical commitment
to the New Deal system of industrial relations and its support of collective
bargaining. They perceived human relations to be another, albeit more

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 Golden Age of Industrial Relations

sophisticated, attempt at preserving management control of the work,

place and keeping out unions and collective bargaining. 32 Human re,
lations, with its emphasis on cooperation and worker,employer
integration, also conflicted with the ILE commitment to shared gov,
ernance and pluralism in the economic, political, and social spheres
(Kerr 1954b; Kerr and Fisher 1957).
In response to this antagonistic stance, the members of the PM school
felt that they were at best junior members of the field and at worst
personna non grata. 33 This message was communicated in several ways:
by the stridency of the attacks on human relations34 ; by the exclusion
of much human relations research from the meetings of the IRRA and
the exclusion of prominent scholars in human relations from the pres,
idency of the organization35 ; by the paucity of human relations research
reported in the ILR Review; and by the cold shoulder given to the PM
perspective in Dunlop's influential book Industrial Relations Systems
(1958). Because of its importance to the subsequent development of the
field, Dunlop's book requires more detailed discussion.

DuNLOP's INDUSTRIAL RELATIONS SYsTEMS

Dunlop (1958:vii) states that the purpose of his book is to present "a
general theory of industrial relations; it seeks to provide tools of analysis
to interpret and to gain understanding of the widest possible range of
industrial relations facts and practices." The general theory he proposes
involves three groups of actors: workers and their organizations, man,
agers and their organizations, and government agencies concerned with
the workplace. The behavior and interactions of these actors is critically
affected by the complex of rules (agreements, statutes, orders, regula,
tions, practices, customs, and so on) found in every industrial relations
system. 36 The central task of a theory of industrial relations, Dunlop
states, is to explain why particular rules are established in particular
industrial relations systems and how and why they change in response
to changes affecting the system. The key consideration in this regard,
according to Dunlop, is the environmental context of the actors, rep,
resented by three interrelated factors: technology (the production pro,
cess, the size of the plant, the required job skills, and so forth); market
or budgetary constraints (the degree of competition in the product and
labor markets, the characteristics of the work force, the amount of profit
or the size of the budget, and so on); and the power relations and statuses

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 Golden Age of Industrial Relations

of the actors (the laws affecting union organization and bargaining

power, the amount of rule-making authority vested in management, and
so on}. Finally, the last component of Dunlop's model is ideology, the
set of shared values and beliefs regarding the interaction and roles of
the actors that helps bind the system together.
Several aspects of the book are noteworthy. For example, Industrial
Relations Systems was the first explicit attempt to frame a general theory
of industrial relations. Several "partial" theories that focused on specific
facets of industrial relations behavior had been advanced earlier, such
as Commons's ( 1909) theory of the extension of markets and trade union
development, Perlman's (1922) theory of the labor movement, and
Ross's (1948) theory of the trade union as a political institution in an
economic environment, but no one before Dunlop had attempted to
construct a conceptual framework that integrated and systematized the
disparate parts of the field into a coherent whole. In effect, what Dunlop
attempted to do was transform industrial relations from a multidiscipli-
nary field of study that drew on bits and pieces of theories from other
fields into a unique academic discipline with a broad-based theoretical
framework that was capable of generating hypotheses on the full range
of behavior found in the employment relationship.
Another notable aspect of Dunlop's book was that it shifted the focus
of the field from its institutional-inspired preoccupation with fact-
gathering and problem-solving toward a more rigorous science-building
approach that emphasized theory construction, the deduction of hy-
potheses, and the testing of hypotheses. In this regard, Dunlop states
(pp. vi-vii}:

The field of industrial relations today may be described in the words

of Julian Huxley: "Mountains of facts have been piled up on the plains
of human ignorance.... The result is a glut of raw material. Great
piles of facts are lying around unutilized, or utilized only in an occasional
manner." ... This volume reflects the judgement that far too much of
the writing concerned with industrial relations ... has lacked intellec-
tual rigor and discipline. The need has been for theoretical structure
and orientation.

Dunlop's book also gave short-shrift to the PM perspective in indus-

trial relations, particularly the human relations movement. In its almost
four hundred pages, the book makes no mention of Mayo, Roethlis-

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 Golden Age of Industrial Relations

berger, Dickson, Whyte, Homans, or other major PM figures (the closest

exception is Benjamin Selekman) or of significant research results from
the behavioral science side of industrial relations. Likewise, Dunlop's
theoretical framework focuses almost exclusively on the external envi,
ronment and the relations between organizations (firms, unions, asso,
ciations of firms and unions, government) as the determinants of
industrial relations outcomes and almost entirely omits from the theory
such staples of the human relations model as leadership and supervisory
styles, informal work groups, worker morale, patterns of interaction and
sentiments, and organizational integration. 37 In this respect Dunlop
more than lived up to his earlier claim that the human relations approach
deserved only "a minor role" in a full explanation of industrial relations
behavior. Dunlop's position had the effect of accepting human relations
as a member of the industrial relations family but rejecting it as of
substantive importance. Dunlop was also clearly not willing to accept
Myers's proffered compromise. 38
The final noteworthy aspect of Dunlop's book is that the discussion
of industrial relations systems is framed almost entirely in terms of
unionized employment situations. The primary reference to nonunion
employers is on pages 116-17, where he discusses four models of manage,
rial authority-dictatorial, paternal, constitutional, and worker,
participative-of which the first two occur in nonunion situations. No,
where else in the book are nonunion firms (or these authority models)
discussed in any detail; nor are any examples of rules or rule making in
nonunion firms provided. This stands in sharp contrast to the extensive
discussion given to collective bargaining situations in coal mining, con,
struction, railroads, and automobiles and the dozens of examples of rules
negotiated in these industries by unions and firms. One is left with the
distinct impression that in Dunlop's mind the subject of industrial re,
lations is largely coterminous with the organized sector of the economy. 39
Dunlop's book was widely hailed as a major scholarly work and many
researchers still regard it as the first and foremost statement of IR theory
(seeR. Adams 1988; Fiorito 1990; Meltz 1991). From my point of view,
the book has been immensely influential, but for reasons quite apart
from the quality of the scholarship or the merits of the theory per se.
Industrial Relations Systems marked out a distinct Y in the intellectual
road for industrial relations. The Y, in tum, was formed as a result of
a fundamental contradiction. Dunlop claimed that the book presented

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 Golden Age of Industrial Relations

a general theory of industrial relations, yet it omitted almost entirely

discussion of the PM perspective, research findings from the behavioral
sciences, the nonunion (unorganized) sector of the economy, and the
organizational structure and internal dynamics of either companies or
unions. 40 The book also sought to move industrial relations away from
its historic emphasis on applied, problem-solving, multidisciplinary re-
search and toward a more academic, science-building, unidisciplinary
orientation.
Thus, Dunlop presented the field with a clear choice. If it followed
the model he laid out, it would effectively shed the PM school and its
behavioral science disciplines and become a more rigorous but narrowly
constituted field oriented toward the discipline of economics (and to a
lesser extent law), the study of unions and collective bargaining, and
the policy perspective of the ILE school. If it rejected his model, the
field would remain as it had been constituted since the 1920s-as a
coalition of disciplines from both the behavioral and nonbehavioral
sciences, oriented toward a relatively applied, problem-solving approach
to research. It would provide relatively balanced coverage of union and
nonunion work situations and the structure and operation of firms and
labor organizations, using two rival policy perspectives (the ILE and the
PM schools) on the resolution of labor problems.
Which fork in the road was chosen? In hindsight, it is clear that the
field followed the path laid out by Dunlop, albeit for a variety of reasons,
many of which had little to do with him. The year 1958, therefore,
marks a symbolic turning point in the intellectual history of industrial
relations as a field of study. Why did IR scholars make this choice? The
next two chapters provide an answer to this pivotal question.

102
 6
THE HoLLOWING OuT OF
INDUSTRIAL RELATIONS

0 N THE SURFACE, the 1960s and 1970s were a period of expansion

and consolidation for industrial relations as a field of study. The
number of IR programs in the United States continued to in,
crease so that by 1965 more than forty had been established (Derber
1967:8), and the number continued to grow into the 1970s. New pro,
grams were created after 1960 at the University of Oregon, Ohio State,
Iowa State, Alabama, Georgia State, Pace, the New York Institute of
Technology, North Texas, Xavier, and Cleveland State. The number
of Ph.D. programs also grew. Some schools (e.g., Illinois, Michigan
State) followed the Cornell model and created separate interdisciplinary
Ph.D. programs in industrial relations, while others (e.g., Iowa, Georgia
State) established an IR major in an existing Ph.D. program in business
administration or economics.
Progress on the research front was less clear cut, but positive signs
were certainly evident. For example, the journal Industrial Relations was
founded in 1961, under the auspices of the Institute of Industrial Re,
lations at the University of California at Berkeley. 1 Substantial bodies
of new research were also published on hitherto unexplored topics, such
as public sector collective bargaining and manpower programs. Also
noteworthy, scholars were making much greater use of mathematics,
formal theoretical models, and statistics in research. Finally, academic
membership in the IRRA nearly tripled between 1960 and 1979. Based
on a survey of IR research completed as of the late 1960s, Herbert
Heneman, Jr. (1968:49), was sufficiently impressed to declare (possibly
with a degree of overstatement), "The two most important disciplines

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 Hollowing Out of Industrial Relations

of the first half of this century were mathematics and physics; beyond
reasonable doubt industrial relations is the most important discipline of
the second half."
Heneman based his claim on the fact that the field of industrial
relations covered all aspects of the world of work and that developments
and trends in the world of work had become central, in his view, to
the nation's social and economic progress. But, ironically, even as Hene-
man was writing these words, the core of the field was being seriously
eroded, including its hitherto undisputed claim of intellectual sover-
eignty over the subject of work. In particular, what occurred between
1960 and 1979 was a hollowing out of the field as it metamorphosed
from a broad coalition of behavioral and nonbehavioral disciplines de-
voted to the study of all aspects of the world of work to a much narrower
field devoted to the study of unions, collective bargaining, and the
employment problems of special groups (e. g., minorities, the aged, the
poor) with a core group of committed participants made up mainly of
a small and dwindling number of institutional labor economists.
If unionism and collective bargaining had continued to grow in the
1960s and 1970s as they had in the previous two decades, this narrowing
of focus might have been both intellectually justified and organizationally
viable. As it was, the nonunion sector of the economy became not only
the major source of new gains in employment but also the major source
of new innovations in employment relations practices (Foulkes 1980;
Kochan, Katz, and McKersie 1986). The result was that the preoccu-
pation of industrial relations with unionism and collective bargaining
led to its gradual decline as a field of study, a condition partially hidden
from view through the 1970s but one that became all too obvious in
the 1980s.
This chapter explores both the symptoms and the causes of the hol-
lowing out of industrial relations. Specifically, it examines the debate
over the theoretical and disciplinary status of the field in the 1960s; the
narrowing of industrial relations from a broad "all aspects of employment
relations" definition to a narrow "labor-management" definition; the
decision of the PM school to end its association with industrial relations
and establish itself as a separate, rival field of study; and the growing
estrangement between the fields of labor economics and industrial re-
lations. I then discuss four reasons for the hollowing out: the increased
emphasis among academics on science-building and the concomitant

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downgrading of problem,solving research; the incompatibility of the

theoretical models used by the members of the PM and ILE schools; the
adverse tide of current events; and the pro-collective bargaining value
system of the major academic figures in industrial relations.

DEBATE OVER THE THEORETICAL AND DISCIPLINARY

STATUS OF IR
A palpable sense emerged among IR scholars in the 1960s that in,
dustrial relations had lost its intellectual bearings. The result was a large
volume of articles and books that took an introspective, often critical
look at the field, a mood that seemed strangely at odds with the decidedly
upbeat spirit that had prevailed only a few short years ago. The temper
of the times was captured by Donald Woods (1968:87) at a conference
that had analyzed various alleged problems in IR programs:

I approach my task this morning with some reluctance for I feel that
our discussion is simply a part of a long playing record that has been
playing the same old melody and the same old lyrics for many years.
If you examine the annual proceedings of almost any industrial relations
or personnel association you will find periodic public confessionals de,
crying the second class status of industrial relations. The theme is always
the same-the lack of rigorous theoretical underpinnings, the cleavage
between theory and practice, the lack of intellectual cohesion and
respectability, whether industrial relations should be a separate disci,
pline in its own right, and whether the subject should be oriented to
traditional disciplines or be interdisciplinary in nature.

As Woods suggested, the debate over theory and methods during this
period revolved around several related and interconnected themes:
whether IR was best conceptualized as an art or a science; whether IR
had a theoretical framework and, if it did not, whether such was possible;
whether IR was a bona fide academic discipline and, if it was not,
whether it was practical and desirable for it to become one; and, finally,
among those scholars who believed IR was not a self,contained disci,
pline, whether teaching and research in the field should be organized
on a loosely structured multidisciplinary or closely integrated interdis,
ciplinary basis. As shall become clear, IR scholars were in effect arguing
over the merits of two very different conceptualizations of the field.

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 Hollowing Out of Industrial Relations

ART OR SCIENCE?
The debate over whether IR was best conceptualized as an art or a
science originated in the multiple objectives of the field's founders: the
reform of workplace organization and practice, the promulgation of new
public policies, and the advancement of knowledge. Before the 1950s,
IR was heavily oriented toward the first two goals, which had given the
field a distinct applied, problem-solving character. This character was
accentuated by the heavy intellectual influence of institutionalism,
which favored an inductive, case study, historical approach to research
over more formalized, deductively derived theories and frameworks.
The proponents of IR as an art or exercise in problem-solving largely
came from the reform, public policy, institutional perspective. Thus, J.
Douglas Brown, an early advocate of this position, stated in his IRRA
presidential address (1952:6}:

Industrial relations is not a science. Rather it is the study of the values

arising in the minds, institutions, and emotions of individuals as these
values become embodied in group organization and action. The un-
derstanding and solution of problems of group organization and action
can never be divorced from the more basic understanding of the values
which determine individual behavior. No matter how useful scientific
methodology may be along the way, the goal of industrial relations
research and practice lies beyond the "timber line" of science.

In a similar vein, Slichter, Healy, and Livemash (1960:6} said: "The

factors involved in industrial relations are so numerous and occur in so
many combinations and permutations that worthwhile theories are dif-
ficult to formulate. What is important is to know what is going on and
to see that every industrial relations situation is more or less unique and
must be explained as a whole."
Finally, George P. Shultz (1968: 1) stated in his IRRA presidential
address: "The field of industrial relations, in my view, is problem-based.
It is not a discipline in itself but rather draws on many disciplines for
theory and techniques to understand and help solve the problems arising
in the workplace, the labor market and at the bargaining table."
Other IR scholars had the opposite view. John Dunlop (1958:vi-vii),
for example, claimed that the preoccupation of the field with fact-
gathering caused it to lack scientific rigor and that the greatest need

106
 Hollowing Out of Industrial Relations

was for the development of a theoretical structure. Milton Derber, an,

other proponent of the "science" view, stated (1964:604):

The "art" conception, with its focus on uniqueness, tends, I believe,

to have a limiting effect.... If every case is unique, why bother to
investigate more than a few examples? ... The social science attitude
toward industrial relations research promotes a different climate. It
implies first of all a conscious awareness of the scientific method. It
impels the researcher to break down his problem in terms of its basic
theoretical foundations. It stimulates an interest in study design and
in more efficient techniques of data collection. It encourages experi-
mentation with varying observational quantitative tools. It gives the
researcher an incentive to view his problem and his data in a broader
setting and to develop hypotheses and key questions for further
investigation.

THE DISCIPLINARY STATUS OF IR

Another area of debate concerned whether IR had achieved the status
of an academic discipline and, if it had not, whether doing so was both
practical and desirable. The importance of this issue was attested to by
Martin Estey (1960:99) in a report to the IRRA that summarized the
results of his comprehensive survey of academic IR programs: "Perhaps
the most challenging issue with which educators in the field are grappling
is whether industrial relations is, or can become, a discipline in its own
right."
A review of the literature of the period reveals that most IR scholars
believed the field had not yet achieved status as a true discipline (Tripp
1964; Woods 1968; Shultz 1968; Heneman 1969). Gerald Somers
(1969:vii) said, for example, "Even its most devoted supporters must
confess that industrial relations has not yet achieved a status comparable
to the traditional academic disciplines." Some accepted this lack of
status with equanimity, while others believed it to presage the decline
of the field. The former view was based on the argument that the
multidisciplinary character of industrial relations was a strength because
the study of employment issues requires a diversity of theoretical and
methodological perspectives (Aronson 1961:42-43; Shultz 1964.). Op-
ponents argued that the multidisciplinary character was a weakness be-
cause the lack of a unifying theoretical framework (the sine qua non of

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 Hollowing Out of Industrial Relations

a discipline) inhibits rigorous research and thereby encourages scholars

to forsake IR for their home disciplines (Somers 1969:40).
IR THEORY
The debate over the disciplinary status of IR was closely tied to the
controversy over whether it was possible and desirable to develop a body
of IR theory. Most IR scholars were in agreement that, despite Dunlop's
best efforts, the field still lacked an integrating theoretical framework
(Aronson 1961; Chamberlain 1960; Derber 1964; Heneman 1969; So-
mers 1969). Controversy raged, however, over the feasibility and de-
sirability of constructing such a framework.
Advocates of developing a body of IR theory cited several reasons for
doing so. Theory, they said, was necessary to guide researchers in the
selection of topics, the development of hypotheses, and the interpre-
tation of data. Robert L. Aronson (1961:27-28) expressed this view:
Ideally, our research problems ought to be formulated with reference
to a theoretical framework of large scope and significance. That is, we
should have constantly before us, so to speak, some kind of intellectual
construct that enables us to organize knowledge and to choose between
socially relevant research questions and those which, in Merton's terms,
are "scientifically trivial." ... Theorizing of any kind, low or high order,
is in fact rather rare in our field. More typically, we seek data first and
either ask questions later or hope that, through statistical manipulation,
the data will order themselves into useful patterns of relationship. If
not logic, then experience will certainly tell us that this kind of naive
empiricism is an unrewarding approach to greater understanding.
Another commonly cited problem resulting from the lack of theory
was that research in the field shifted from subject to subject as scholars
responded to the latest newspaper headlines or shifts in the funding
priorities of foundations. Derber ( 1964:606) stated the problem this way:
This very incomplete picture of postwar research leads to two conclu-
sions: (a) in a comparatively short period of time (less than two decades)
research in industrial relations has fluctuated quite widely among subject
areas, and (b) the shifts have been closely related to shifts in contem-
porary public problems .... A certain measure of variety in problems
not only is desirable to refresh the typical researcher but may also enrich
successive projects. But "following the headlines" or "responding to
the lure of foundations" is not the way to construct a reliable body of
concepts, facts and principles.

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 Hollowing Out of Industrial Relations

Finally, the advocates of developing IR theory noted that a field built

on the findings of case study empiricism (descriptive, statistical, or what-
ever) was incapable of providing more than ad hoc and ex post diagnoses
of the causes of employment problems and suggested resolutions thereof.
As Aronson (1961:34) put it, "The lack of a theoretical framework in
our field is the explanation of our failure to anticipate and respond to
the issues of public policy and concern. This is, perhaps, the ultimate
irony: having eschewed theory for empiricism, we are helpless in the
face of pragmatic problems."
Other scholars denied that IR theory was either achievable or desir-
able. Their basic argument was twofold. First, a unique theory of in-
dustrial relations was impossible given the nature of the phenomenon
(the employment relationship) under investigation. In this vein, Neil
Chamberlain (1960: 101-3) stated:

If one stops to consider what constitutes the bond of association between

those who inhabit our professional territory, he is driven back on the
thin line of defense that it includes all of those whose interests are
touched by labor.... I have not, however, been able to discover any
unifying theme in the study of labor.... The word-1 cannot even
call it a concept, since it represents a bundle of concepts-does not
create any unifying or central preoccupation, to give meaning to our
association. There is no broad problem which unites all in search for
greater understanding it. In each of its many contexts and conceptual
forms, "labor" may be an instrument for organizing knowledge, but as
a single enveloping interest it is without content and no more useful
in organizing knowledge than would be, for example, the effort to relate
the study of money in whatever context it is found.

Woods provides another example of this viewpoint (1968:88):

If our definition [of industrial relations] is so broad as to include the

whole range of subject matter related to this field-labor economics,
labor law, labor history, human relations, and the behavioral sciences-
then we do not have a single, uniform theory covering all of these
areas, and we probably never will have one. True, we may develop
some broader frameworks for at least better understanding the variables
and relationships operating in this field. But this will not provide an
integrated body of theory that can be used as an operational, analytical
tool.

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 Hollowing Out of Industrial Relations

If the development of IR theory was not achievable, then what was

the better approach? The answer, according to this group of scholars,
was, first, to recognize that the most rapid theoretical advances would
result if scholars specialized in theory development within each of the
constituent disciplines of industrial relations and, second, to structure
industrial relations as an applied field of problem-solving in which the-
oretical constructs and concepts could be mixed and matched to suit
the topic at hand. Thus, Chamberlain (1960:102-3) stated:
I am not decrying the importance of understanding and drawing on as
many areas and fields of knowledge as a person is capable of assimilating.
I am just suggesting that intellectual progress is made up of bits of
knowledge, from whatever sources derived, that are put together in
meaningful patterns and organized around conceptions and related to
central problems. This requirement is the reason, I am sure, why each
of us has retained a kind of Oedipal attachment to the discipline which
has mothered us .... I am suggesting that the relevance of the infor-
mation which is derived from other fields is enhanced, not lost, by
pouring it into the theoretical preoccupations which characterize the
individual's home discipline.
Likewise, Woods (1968:88) said:
If we look at particular areas within the industrial relations field, such
as labor economics, then there already is a body of established theory.
There are gaps in these theoretical constructs. And we have not ex-
ploited these theoretical tools and concepts as rigorously or as broadly
as we could. But the solution is not to desert our basic disciplinary
base, whatever it may be, but to improve it and make it more relevant
for the broader field of industrial relations. It is my view that we have
to rely largely on our mother discipline for new theoretical ideas, while
at the same time being ready to accept any relevant concepts available
in cognate disciplines.
INTERDISCIPLINARY OR MULTIDISCIPLINARY?
Another dimension of the dispute concerned the merits of organizing
IR research on an interdisciplinary versus a multidisciplinary basis. Der-
ber (1967:16) framed the issue as follows:
The relative merits of the interdisciplinary approach are still being
debated. Its proponents note that only through the utilization of the
concepts and techniques of several disciplines can labor problems prop-

II 0
 Hollowing Out of Industrial Relations

erly be studied and analyzed. By combining the disciplines as dictated

by the problems, the research will have the benefit of the most advanced
and sophisticated developments in these disciplines. The opponents of
interdisciplinary research argue that this approach is unduly time,
consuming and that it forces compromises which involve a watering,
down of disciplinary standards.

Widespread agreement existed that the amount of interdisciplinary

research (i.e., research performed by persons from different disciplines
that integrated theoretical concepts and/or methodological tools from
these disciplines) in industrial relations had noticeably declined after
the mid-1950s (Derber 1967:136; Filley 1968). Controversy remained,
however, as to whether this decline was something to be lamented. As
Derber suggested, those IR scholars who saw the field as chiefly oriented
toward problem,solving favored the interdisciplinary approach. Their
major justification was that employment problems almost always contain
a mix of economic, social, psychological, legal, and organizational di,
mensions and, thus, an adequate understanding and resolution of these
problems requires a melding of theories and perspectives from all the
disciplines germane to the issue (Dunnette and Bass 1963; Shultz 1964).
Other scholars took a different view, however (Somers 1961, 1969;
Heneman 1969). As they saw it, the major purpose of research should
be to push out the frontiers of knowledge and build industrial relations
as a science, implying a major emphasis on constructing theories and
testing hypotheses. This group, therefore, was considerably more skep,
tical about the virtues of interdisciplinary research insofar as attempting
to traverse disciplinary boundaries makes theory construction and the
derivation of hypotheses quite difficult. For these reasons, they favored
one of two approaches: the more preferred was to create a unique the,
oretical base for industrial relations and make the field a discipline of
its own; the fallback was to structure industrial relations as a loose
multidisciplinary field, have researchers concentrate on science, building
in their respective disciplines, and encourage where possible a cross,
fertilization of ideas.

IMPLICATIONS
It is noteworthy that this debate over the appropriate conceptuali,
zation of industrial relations did not occur until the 1960s, a full forty
years after its founding as an academic field of study. Given that a broad

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 Hollowing Out of Industrial Relations

consensus had existed in earlier years concerning the essential features

of industrial relations (e.g., Miller and Form 1951; Wilensky 1954;
Reynolds 1955), the emergence of this debate must be regarded as strong
prima facie evidence that the intellectual foundation of the field had
recently shifted or was in the process of being realigned.
Further, these debates clearly represented two opposing views of the
nature and the future of the field. The first view was that of the "tra-
ditionalists," who desired to preserve industrial relations as a confed-
eration of researchers from a variety of disciplines engaged in applied,
empirically oriented, interdisciplinary research on labor problems. The
second view was that of the "modernists," who put greater emphasis on
the importance of rigorous, scientific research.
The modernists were thus the change agents in industrial relations
in that the field as it then existed did not provide what they most
wanted-a theoretical framework and the opportunity to pursue "hard"
academic research. The drive for such a framework led the modernists
in two potentially opposite directions. The preferred direction was to-
ward the creation of a theoretical framework that integrated the various
disciplines relevant to the employment relationship, thus establishing
industrial relations as a bona fide discipline on a par with economics
and sociology. If the effort at integration failed, however, the modernists'
quest for theory and science-building would then lead to an entirely
different outcome; namely, the breakup and fragmentation of the field
as researchers retreated to their home disciplines and the theoretical
frameworks therein and as various subject areas of industrial relations
were spun off to whatever discipline had the most relevant theoretical
framework for the issue at hand. Although the disputants in the debates
probably did not fully realize the consequences of the choices being
made, these choices were to be momentous for the future of the field.

NARROWING oF THE INTELLECTUAL DoMAIN

While IR scholars were immersed in the debate over problem-solving
versus science-building, a second transformation was taking place in
industrial relations that was far more profound but much less discussed.
This transformation was the narrowing of the intellectual domain of
industrial relations from a field that included research on all aspects of
the employment relationship, and most particularly on both union and

I I2
 Hollowing Out of Industrial Relations

nonunion work situations, to a field focused largely on the study of

unionism and collective bargaining. 2
It is difficult to pinpoint exactly when industrial relations became
more narrowly defined. It seems reasonably clear, however, that the
process began with the institutionalization of the field immediately after
World War II, became evident in IR research in the mid~ to late 1950s,
accelerated in the early 1960s, and was largely accomplished by the
early 1970s.
Up to the mid~1950s, it was accepted without question that industrial
relations included both the ILE and the PM schools and thus issues
related to employer~employee relations in both union and nonunion and
interorganizational and intraorganizational contexts. 3 This definition
was clearly acknowledged in both IR academic programs and scholarly
research, as documented in the previous chapter. During the 1960s and
1970s, IR academic programs continued to include courses from both
the ILE and the PM wings of the field, thus maintaining a fidelity to
the original broad, integrative conceptualization of the field. In the area
of research, however, the field was caught in a contradiction of growing
proportions as IR scholars continued to profess allegiance to the broad
conceptualization of industrial relations (Heneman 1969; Somers 1969)
while the research they performed had less and less of a management
or behavioral science focus and, concomitantly, an ever greater focus
on collective bargaining and labor economics.
This narrowing of focus is evident from the topics of the articles
published in the ILR Review and Industrial Relations, the two major
academic journals in the field. I examined articles published in the
Review for two time periods, 1955-59 and 1975-79, and calculated the
proportion of those articles that pertained to three broad subject areas:
unions and collective bargaining, labor economics, and personnel and
organizational behavior (OB). 4 For 1955-59, 68 percent of the articles
were related to unions and collective bargaining, 22 percent to labor
economics, and 10 percent to personnel and OB. The distribution for
1975-79 was 33 percent, 61 percent, and 6 percent, respectively.
I did the same calculations for Industrial Relations but started with the
years 1961-65 (1961 was the first year of publication}. For the 1961-
65 period, 50 percent of the articles were on unionism and collective
bargaining, 24 percent were on labor economics, and 26 percent were

11 3
 Hollowing Out of Industrial Relations

on personnel and OB. During 1975-79, the figures were, respectively,

51 percent, 36 percent, and 13 percent.
Clearly, by the late 1970s, the major IR journals had become a near
exclusive preserve for research on such ILE-oriented subjects as labor
markets, collective bargaining, and the employment problems of par-
ticular labor force groups. Equally important, the proportion of articles
devoted to pure labor economics topics was increasing, particularly in
the ILR Review, where the share of such research nearly tripled over
this twenty-year period. Given the concomitant disappearance in the
journals of descriptive case studies and data collected by the participant·
observer (two favorite research methods of the institutionalists and be-
haviorists), by the late 1970s it was increasingly difficult to distinguish
IR journals from other applied journals that catered to labor economists. 5
Another piece of evidence comes from the topical focus of the IRRA's
research volumes. During the late 1950s, the IRRA published two re-
search volumes that were clearly consistent with the broad, integrative
definition of industrial relations. The first was the 1957 volume Research
in Industrial Human Relations (Arensberg et al.), which included a num-
ber of chapters on management and organizational issues but only four
(out of thirteen) on subjects related to unionism. The second was the
1960 volume Employment Relations Research (Heneman et al.), which
contained six chapters, two devoted to management issues, two to labor
economics, and two to collective bargaining subjects.
During the 1960s, by contrast, the IRRA research volumes were
devoted entirely to collective bargaining or labor economics topics. The
marginal position of management-related subjects in industrial relations
was then attested to by George Strauss in the 1970 research volume A
Review of Industrial Relations Research (Ginsburg et al.). In his chapter,
"Organizational Behavior and Personnel Relations," Strauss states (pp.
201-2): "I must predict this may be the last review which deals with
OB as a part of industrial relations. Personnel's loss of status means that
it can no longer serve as a bridge between the fields .... Though IR
claims to be multidisciplinary, it is in fact heavily dominated by econ-
omists and for many in the field the terms industrial relations and labor
economics are interchangeable."
Strauss's prediction proved to be overly pessimistic given the IRRA's
subsequent decision to devote the 1974 research volume to organiza-
tional behavior. Nevertheless, the increasingly tenuous position of hu-

I I4
 Hollowing Out of Industrial Relations

man relations and organizational behavior-type research was attested to

in the preface to the 1974 volume: "The question of whether to publish
a book devoted to Organizational Behavior (OB) caused strenuous debate
within the Executive Board. There was one group which felt that OB
did not really belong with Industrial Relations. The other group was
willing to provide an opportunity to test OB's relevance." Twenty years
earlier such a question never would have been debated.
Three symposia on behavioral research in industrial relations provide
further evidence of the transformation of the field. The first symposium,
published as a monograph by Industrial Relations Counselors in 1962,
was entitled Behavioral Science Research in Industrial Relations. In the
introductory paper, "A Broadening View of Industrial Relations," Rich-
ard Beaumont, director of research for the IRC, states (p. 9) that the
purpose of the symposium is to help management in "establishing and
maintaining effective human relationships." He cites six issues that are
crucial to this task: selection, motivation, evaluation, identification,
communication, and organization. The remainder of the volume is de-
voted to six papers that explore various facets of these issues, authored
by such well-know:n academic members of the PM school as Frederick
Herzberg, Chris Argyris, and Leonard Sayles.
This volume is noteworthy in that it provides yet another example
of the existence of the PM wing of industrial relations. Further, it
documents that as of the early 1960s at least some participants in in-
dustrial relations still perceived the field to include academics from the
management and behavioral science side of employment relations. The
volume is also noteworthy in that it is one of the last collections on
human relations and OB topics to be published under the label of in-
dustrial relations.
The second symposium, "The Behavioral Sciences and Industrial Re-
lations," was published in 1965 in the ILR Review. In the introduction,
the journal editor stated that the purpose of the symposium was to "clarify
the relationship of the field of organizational behavior to the study of
industrial and labor relations as well as applications of behavioral analysis
to general and specific industrial relations problems." In the lead article,
William Foote Whyte (1965) discussed the origins, development, and
current status of the field of organizational behavior. The remainder of
the symposium was devoted to five papers by authors from sociology,
psychology, management, and economics and political science, four of

I I5
 Hollowing Out of Industrial Relations

which were on general management and organizational issues and one

of which focused on a specific aspect of collective bargaining, strikes.
Like the IRC volume, the authors of the Review articles viewed industrial
relations as a field that included academic research in the classic PM
tradition-the study of organizations and the practice of management
using the theory and methods of the behavioral sciences. The symposium
also provides clear evidence that behavioral science and management-
oriented research had noticeably slipped from being a central part of
theIR research program on the employment relationship (as in the early
1950s) to a subject on the periphery of the field. If this were not the
case, why would the Review have thought it necessary to sponsor a
special symposium on the subject?
The third symposium, "Behavioral Research in Industrial Relations,"
was published in 1983, also in the ILR Review. It clearly illustrates the
narrowing of the field that took place over the previous fifteen years as
IR shed general management subjects and became increasingly associated
with the study of unionism and collective bargaining. Thus, of the seven
papers selected as examples of behavioral IR research, all were devoted
to some aspect of collective bargaining. Even more revealing, although
the purpose of the introductory paper by Lewin and Fueille (1983) was
to provide a comprehensive review of behavioral research in industrial
relations, it focused almost exclusively on behavioral research related
to collective bargaining subjects (e.g., union representation elections,
bargaining, strikes) and omitted almost all mention of the large body
of nonunion-related human relations research of the 1950s or the OB
or human resource management (HRM) research of the 1960s and 1970s.
Thus, although behavioral science research was still being conducted
in industrial relations, the perceived domain of IR research had been
narrowed so that it now focused on unionized employment situations
and the institutions, practices, and impact of collective bargaining. 6
Miller and Form's text Industrial Sociology (1951) provides yet another
piece of compelling evidence of the change in the field. Their "family
tree" of industrial relations (see fig. 3.1), in the first edition of their
book, clearly reveals that they and other behavioral science scholars
considered themselves and their subject area to be a part of industrial
relations. This is also suggested by the broad definition of industrial
relations implicitly used by Miller and Form in the first chapter of the
text, a definition that in effect equated the field with the study of work

116
 Hollowing Out of Industrial Relations

in all its different dimensions. By the second edition, published in 1964,

the family tree had been dropped, along with all mention of the term
industrial relations in the first chapter. These deletions suggest that Miller
and Form no longer perceived industrial sociology to have a close kinship
to industrial relations. 7
A final piece of evidence comes from the observations of historian
David Brody. Speaking of the field of industrial relations in the 1960s
and 1970s, he says (1989:9):
There was, at once, a retreat from the interdisciplinary scope and the
methodological eclecticism t4at had for so long characterized labor
scholarship. Sociologists, political scientists, and anthropologists lost
interest in labor topics, while labor economics took up neoclassical
analysis with a vengeance, applying it first to the study of human capital,
then to whatever else could be subjected to deductive, individual-level
microanalysis. The academic high ground was meanwhile seized by the
new discipline of organizational behavior, which had sprung from the
human relations strain within the postwar industrial relations field and
now pronounced itself a behavioral science capable of conducting rig-
orous quantitative and theoretically grounded analysis. Industrial re-
lations itself shrank down into a kind of mini-discipline, confined as
before to the union sector, but striving belatedly to assert its own
credentials as a rigorous social science.
As Brody suggests, the result of the trends outlined above was that
industrial relations became, in the view of most academics and practi-
tioners, synonymous with the study of unions and collective bargaining. 8
The outcome was a growing gap between the professed intellectual
domain of the field and the actual domain as evidenced in IR research. 9
Thomas Kochan's textbook Collective Bargaining and Industrial Relations
(1980) provides a particularly clear illustration of this contradiction. In
the first sentence of chapter 1, Kochan defines industrial relations as "a
broad, interdisciplinary field of study and practice that encompasses all
aspects of the employment relationship." In the third sentence, how-
ever, he introduces a qualifier that permits him to move swiftly to the
narrow definition: "Within this broad field industrial relations profes-
sionals have historically given special attention to relations between
labor and management." The remainder of the text is then devoted to
the theory and practice of union-management relations.
The IRRA's choice of session topics for its annual winter meetings

11 7
 Hollowing Out of Industrial Relations

in the late 1970s provides further evidence of the gap between the field's
stated ideals and actual practice. As noted earlier, the IRRA was founded
with the express purpose of fostering research on all aspects of the
employment relationship, including union and nonunion work situa~
tions. It is understandable that in the first decade of the organization's
existence a large number of sessions would have been devoted to topics
pertaining to the union sector, given the meteoric rise of organized labor
in the previous two decades and the host of important problems and
issues in labor~management relations that demanded attention. By the
late 1970s, however, the share of the organized work force had dropped
sharply and many of the innovations in employment practices were
originating in the nonunion sector. Did the IRRA's selection of session
topics reflect this shift? An examination of the proceedings of the winter
IRRA meetings for the years 1975-79 reveals the answer is clearly no.
They contained twenty~five sessions related to some aspect of union~
management relations and only five pertaining to some aspect of non~
union work situations.

THE PM ScHOOL LEAVES INDUSTRIAL RELAnoNs

In the last chapter I suggested that Dunlop's Industrial Relations Systems
effectively defined an intellectual crossroad for industrial relations, with
one branch corresponding to the broad conceptualization of the field
(the confederation of the PM and ILE schools with a significant rep~
resentation of behavioral and nonbehavioral and union and nonunion
viewpoints) and the other representing the narrow conceptualization
(near~exclusive dominance of the ILE school with its economic and
institutional disciplinary focus and topical concentration on labor~
management relations). The evidence clearly suggests that the narrow
definition was chosen. As a result, the field gradually lost its historic
claim to cover all aspects of the employment relationship and instead
became associated with the study of unionism and collective bargaining.
Furthermore, the PM school slowly divorced itself from industrial re~
lations and, by the end of the 1960s, had relatively little interaction
with it.
Previous chapters have documented the significant involvement in
pre~ 1960 industrial relations of scholars from the PM school. By the
end of the 1970s, George Strauss was the only prominent representative
of the 1950s~era PM school who could still be considered a card~carrying

118
 Hollowing Out of Industrial Relations

member of the field. In part, this trend reflected natural causes, such
as death and retirement; however, it also reflected a dwindling of par-
ticipation per se, particularly in the form of articles published in the
major IR journals and involvement in IRRA activities. The falloff in
involvement in industrial relations was most marked among sociologists,
which was doubly surprising given the large number of sociologists who
were active in the field in the early 1950s and the emphasis in both
sociology and industrial relations on collective action. 10
Concomitantly, only a small number of the newer generation of be-
havioral science and management scholars became active in industrial
relations. Of those who did, most wrote on collective bargaining-related
topics. The most prominent example of research of this genre was Rich-
ard Walton and Robert McKersie's A Behavioral Theory of Labor Nego-
tiations (1965). Other examples include the papers (some by British
authors, some by American) in Industrial Relations: A Social Psychological
Approach (Stephenson and Brotherton 1979); several articles on strike
trends by sociologists (Britt and Galle 1974; Snyder 1977); and a smat-
tering of articles on the determinants of union joining (e.g., Schriesheim
1978). 11
The number of younger PM-oriented scholars who were active in
industrial relations in the 1960s and 1970s and who did non-collective
bargaining research was relatively small. Included in this group were
Edward Lawler III, Thomas Mahoney, Donald Schwab, jeffrey Pfeffer,
Lyman Porter, and George Milkovitch, all of whom occasionally pub-
lished in the two major IR journals and participated in IRRA meetings
(generally on an invited basis). None, however, was considered a big
name in IR research per se, although several had national name rec-
ognition in their home fields. Perhaps more revealing is the list of PM-
oriented people who were widely recognized for their research on aspects
of the employment relationship and yet were not associated with in-
dustrial relations. Examples include Richard Steers, David McClelland,
Warren Bennis, Stanley Seashore, Jay Lorsch, Paul Lawrence, Victor
Vroom, Daniel Katz, and Fred Fiedler.
Of the many reasons that younger scholars of the PM school decided
not to become involved in industrial relations, one of the most significant
was the birth of the field of organizational behavior and its applied
offshoot, human resource management. Before the mid-1950s, the
management-oriented academics of the PM school may have been dis-

119
 Hollowing Out of Industrial Relations

satisfied and uncomfortable with the field of industrial relations, but no

alternatives existed. The emergence of organizational behavior and hu~
man resource management in the late 1950s-early 1960s provided such
an alternative.
Organizational behavior developed as the fusion of two streams of
thought, human relations and the organization and administration part
of management (Landsberger 1967; Strauss 1970, 1992). The subject of
management was divided in most business school curricula into several
distinct areas, such as production, organization and administration, per~
sonnel, and policy and strategy (Bossard and Dewhurst 1931; Gordon
and Howell 1959). The organization and administration part developed
from the work of Frederick Taylor and was subsequently developed by
people such as Henri Fayol, Max Weber, Luther Gulick, Chester Bar~
nard, James Mooney, and Ralph Davis (Wren 1987). It focused largely
on issues of organizational structure and efficient administrative practices
(e.g., optimal span of control, systems of control and planning}.
Until the late 1950s, human relations and organization and admin~
istration remained largely separate fields of study. Human relations was
largely concerned with face~to~face relations in small group settings and
largely abstracted from issues of organizational structure. Organization
theory took something of the opposite approach.
Scholars such as Bakke, Argyris, McGregor, Whyte, and Bennis were
led toward a fusion of the two areas partly in response to critics (e. g. ,
industrial sociologists} who had charged that human relations ignored
organizational and structural influences on in~ plant patterns of employer~
employee relations. 12 As OB developed, it provided, on several counts,
a far more compatible home for members of the PM school than did
industrial relations: it included mostly persons from a behavioral science
or management perspective, disputes over ideology and anti~unionism
could be largely avoided since OB had an avowedly management per~
spective, and it facilitated the growing specialization and compartmen~
talization that were developing in all areas of academic research.
The emergence and development of organizational behavior also did
much to strengthen the academic fortunes of the field of personnel
management, which at the time was viewed as a second~class citizen in
academe because of its notable lack of theory and rigor (Gordon and
Howell 1959; Dunnette and Bass 1963; Strauss 1970), a fact quickly
revealed by a perusal of the field's leading journals (e.g., Personnel Psy,

120
 Hollowing Out of Industrial Relations

chology and Personnel). 13 During the 1960s, however, personnel began

to undergo a significant metamorphosis as new theories and concepts
discovered in organizational behavior research (and the closely allied
field of industrial and organizational psychology) were applied to the
traditional personnel topics of compensation, recruitment, selection,
performance evaluation, and training. One of these new ideas was to
view employees as "human resources" (Miles 1965; Armstrong 1988).
According to this view, if managers were to unlock employee commit,
ment and work effort, then the workers had to perceive that they were
valuable assets or human resources of the firm, with the implication that
in return for their hard work and diligence the employees would share
in the long,term economic success of the organization.
This perspective led to a significant shift in both management theory
and practice (Lewin 1991). Viewing employees as human resources
rather than as personnel encouraged a change from a short,term,
expense,oriented, tactical approach to the management of labor to a
longer,term, strategic, investment approach. The new field of human
resource management, or HRM as it quickly became known, also led
to a shift in management practices in industry. Whereas human relations
had led managers to emphasize the improvement of interpersonel re,
lations and social conditions in the plant through techniques such as
sensitivity training, human resource management encouraged firms to
focus on practices and techniques that promoted employee development,
such as job enrichment and pay for knowledge. 14 As human resource
management gained in popularity in the 1960s, a growing number of
companies renamed their personnel or industrial relations departments
human resource departments, and increasingly the professionals in these /
departments no longer engaged in IR but in HR. This change in no,
menclature and perspective was to spread to the world of academe a
decade later.

EsTRANGEMENT BETWEEN LABOR EcoNOMICS AND

INDUSTRIAL RELATIONS
The hollowing out of industrial relations was further exacerbated by
the weakening of the links between it and labor economics. As we have
seen, labor economics entered a second phase in its development in the
early 1940s with the shift in focus from the study of labor problems to
labor markets. Although this trend caused a growing cleavage between

12 1
 Hollowing Out of Industrial Relations

industrial relations and labor economics, the multidisciplinary perspec-

tive and practitioner orientation of the labor economists of this period
enabled them to straddle the divide and keep one foot in each field.
Straddling this divide became increasingly difficult after the mid-1950s,
however, as labor economics entered the third phase of its development.
During this phase the shift toward the study of labor markets inten-
sified, while the subjects of labor problems and management's approach
to the resolution of such problems were discarded. This in itself further
separated industrial relations from labor economics as newly trained labor
economists became, in effect, applied price theorists who had little
knowledge of or interest in the employment relationship per se and the
issues therein. 15 This phase was also marked by a profound transformation
in the theoretical, methodological, and ideological approach to the study
of labor markets, all of which were antithetical to the perspective and
purpose of the ILE version of industrial relations.
Intimately involved with this phase in the development of labor eco-
nomics was a group of economists at the University of Chicago whom
Kerr ( 1988) has labeled the "neoclassical restorationists." The seminal
figures were George Stigler and Milton Friedman (see Reder 1982; Kauf-
man 1993). Other members included H. Gregg Lewis, Gary Becker,
Jacob Mincer, Albert Rees, and Melvin Reder.
The events of the Depression had seemingly discredited competitive
neoclassical price theory, a point of view exemplified by the antagonistic
attitude of the ILE-oriented labor economists toward it (L. Reynolds
1988). Stigler and Friedman launched a major counterattack on several
fronts. In the first, Friedman sought to show, with respect to macro-
economic theory, that the Depression was not the inherent fault of the
price system but resulted instead from erroneous policies of government,
thus negating the belief that the price system at the aggregate level was
dysfunctional (Friedman and Schwartz 1963). The second was the rig-
orous development of the theory of price determination in competitive
markets, thereby providing an analytical framework that the critics
lacked (Stigler 1942). The third was the application of the competitive
model to a host of new labor market issues, such as hours of work,
discrimination, education, and family size. This line of attack was started
by Lewis (1956) but was pursued most strenuously by Becker (see Becker
1957; 1976). The fourth line of attack was the methodological attack
by Stigler and Friedman on realism in theory (Stigler 1949; Friedman

122
 Hollowing Out of Industrial Relations

1953). The ILE~oriented economists had attacked competitive theory

because its assumptions were unrealistic (see Phelps 1955:421-45), but
Stigler and Friedman argued that the true test of a theory is its predictive
ability, not the realism of its assumptions. Finally, the restorationists
pioneered the application of statistical methods to the analysis and
testing of labor market hypotheses (see Lewis 1963).
These developments had a markedly adverse impact on industrial
relations. The rise of competitive theory, for example, struck at both
the intellectual and the ideological foundations of ILE~style industrial
relations. The intellectual focus of industrial relations is the study of
labor problems in the employment relationship and methods to resolve
these problems. The assumption underlying this approach is that labor
problems are an inevitable by~product of industrialism and the defects
and imperfections contained in the market system and that various
institutional and administrative reforms are necessary to offset the effects
of these imperfections. In contrast, the premise of neoclassical econom~
ics is that markets operate relatively efficiently and that competitive
forces are an effective guarantor of efficiency in production and equity
in the terms and conditions of employment. From the point of view of
neoclassical economists, therefore, free markets have no "problem" that
needs reform and industrial relations has little intellectual justification,
except possibly as a repository for the specialized study of labor unions.
Ideologically, the ILE school maintained that unions and protective
labor legislation were needed to level the plane of competition, offset
market defects such as public goods and externalities, and provide shared
governance at the workplace. From a neoclassical perspective, these
alleged virtues paled in comparison to the negative consequences that
arose from unioris and government legislation, such as inflated labor
costs, inefficient allocation of resources, reduced productivity, and bar~
riers to competition.
The rise of Chicago~style neoclassical economics also adversely af~
fected industrial relations because of the insularity of disciplinary per~
spectives that it promoted. As discussed earlier, a major impetus behind
the founding of the Industrial Relations Research Association was the
desire of labor economists in the 1940s to promote a more inclusive,
multidisciplinary style of research on labor markets. Industrial relations,
therefore, played an important bridging role as these economists at~
tempted to take the theoretical models from economics and introduce

123
 Hollowing Out of Industrial Relations

into them social, psychological, and institutional variables. The labor

economists of the Chicago school aggressively pursued the opposite tack,
however. Their goal was "imperialistic," in that they sought to take the
economist's basic model of constrained utility maximization and com-
petitive markets and use it to explain as many different dimensions of
human behavior as possible (Becker 1976; Stigler and Becker 1977). As
a consequence, economists not only lost interest in integrating theories
and concepts from other disciplines into economics but increasingly
exhibited a negative attitude toward those who tried. Industrial relations
thus lost its appeal to economists as the entree to other disciplines,
causing all but those interested in union-related topics to forsake the
field.
The net result of all of these developments was that industrial relations
gradually lost much of its theoretical and philosophical link to labor
economics. The World War II generation of labor economists who had
provided the bridge between the two fields ceased to play this role by
the early 1960s. Some turned their research interests toward other areas
(e.g., economic development), while others went on to highly influ-
ential careers as university presidents (Clark Kerr, Arnold Weber, Edwin
Young) and secretaries of the Cabinet (John Dunlop, George Shultz,
Ray Marshall). 16 The new "restorationists," by contrast, had little in-
terest in industrial relations and were certainly hostile to its pro-col-
lective bargaining perspective. Strauss (1978:535) summed up the
situation: "If collective bargaining represents industrial relations' central
core, then labor economics has largely divorced itself from that core."
Beginning in the early 1960s, therefore, industrial relations experi-
enced a hollowing out from two sides. On one side the field gradually
lost PM scholars from management and the behavioral sciences, while
on the other few of the new generation of neoclassical labor economists
chose to become active in the field. The residual group of academics
who remained active participants in industrial relations was composed
of two groups. The larger group was made up of institutionally oriented
labor economists, along with a small number of like-minded people from
law and history. The smaller group was composed of scholars from the
behavioral sciences and management who were interested in unions and
collective bargaining. Unfortunately for the field, both of these groups
had critical weaknesses as a base for future growth. The problem with
the former was that institutionalism was in its death throes in labor

124
 Hollowing Out of Industrial Relations

economics, thus substantially restricting the supply of new economics~

based talent to industrial relations. The problem with the latter group
was that it would never attract large numbers of participants, or the best
talent, since economists controlled the major journals and professional
association and economic theories and statistical methods were the major
research tools in the field.

CAusEs OF THE HoLLOWING OuT PRocEss

Up to this point, the chapter has documented the symptoms of the
hollowing out process. What was the cause of this process? The answer,
I believe, involves four factors.

SCIENCE~ BUILDING

The emphasis on problem~solving and policy formulation in the 1920s

through the early 1940s imparted several distinctive characteristics to
the IR literature of that period. These included a heterodox set of topics,
reflecting the diverse range of labor problems encountered by employers
and workers; a critical tone regarding prevailing economic and social
conditions; a heavily applied, case~ori~nted research method that es~
chewed theory development for the collection of empirical facts; a mul~
tidisciplinary and often interdisciplinary approach to research; and a
strong normative element as researchers not only described "what is"
but also "what should be."
After World War II, a movement developed among academics to
make research in all the social sciences more scientific, an approach I
have referred to as science~building. The hallmark of science~building
is the rigorous application of the scientific method to academic inves~
tigation, where the scientific method involves development of a body
of theory, the use of this theory to generate hypotheses about the causes
of some phenomenon or behavior, and the empirical testing of these
hypotheses through the collection and statistical analysis of data. The
product of such research has several distinctive characteristics, including
a much greater emphasis on theory development; the use of deductive
reasoning to develop such theory, rather than the inductive approach
typically used by problem~solving researchers; research topics in which
less weight is given to the needs or problems of practitioners or policy
makers and more to methodological considerations, such as whether the
problem is amenable to theoretical analysis and whether appropriate

125
 Hollowing Out of Industrial Relations

data are available for empirical analysis; considerable emphasis on meth-

ods and techniques of statistical estimation and hypothesis-testing; un-
idisciplinary research and a focus on small pieces of behavior; and a
sharper separation between positive analysis and normative conclusions.
Both problem-solving and science-building have their strengths and
weaknesses. Among the virtues of problem-solving are its relevance,
realism, and intellectual holism, while its defects include a tendency to
advance causal explanations that are ad hoc, to engage in aimless or
unstructured empiricism, and to let a priori normative beliefs influence
the research. The strengths of science-building are its rigor, quantifi-
cation, and ability to be generalized, while its drawbacks include a
tendency to become overly "academic" in perspective and thus divorced
from real-world concerns of practitioners and policy makers, to empha-
size issues of research methodology over practical significance, and to
focus on minutiae at the expense of the big picture.
Although both approaches to research co-existed from the earliest
years of the field, the problem-solving approach dominated from the
1920s to the early 1940s. From the early 1940s to the early 1960s, the
two co-existed in a rough balance. Since the early 1960s, however, the
science-building approach has gained increasing dominance (Barbash
1979). This trend explains much about the changing character of IR
research and industrial relations as a field of study.
It is not accidental, for example, that in the 1920s and 1930s industrial
relations research had a strong applied, interdisciplinary, reformist fla-
vor, for this was the era when the problem-solving approach was tran-
scendent. Likewise, this fact explains both the virtues of the research
of that period (e.g., its direct relevance to practice and policy) and its
defects (e. g., its atheoretic nature). Similarly, the research during the
1950s was "golden" in part because the academics of the period were
well trained in both science-building and problem-solving, a serendi-
pitous combination that led to outstanding research because it was both
relevant and theoretically informed. Unfortunately, the equilibrium
achieved during the 1950s between problem-solving and science-
building was not stable, and both the pursuit of knowledge and the
internal reward system in academia pushed IR scholars further and fur-
ther in the direction of science-building. The inevitable result was a
clash between the proponents of the two approaches to research that

12 6
 Hollowing Out of Industrial Relations

erupted in the 1960s in the form of the theoretical and methodological

disputes reviewed earlier in this chapter.
In hindsight, it is clear that science,building won out. A comparison
of articles published in the ILR Review and Industrial Relations in the
early 1960s and in the late 1970s reveals several trends: a sharp decline
in case study research, particularly of the old,line institutional variety;
the virtual disappearance of interdisciplinary research; a dramatic in,
crease in articles that make use of a formalized theory or model; a
concomitant shift in the disciplinary orientation of IR research (narrowly
defined) toward economics; a marked increase in the number of articles
that derive hypotheses and then test these hypotheses with advanced
multivariate statistical techniques; a decline in primary source data, such
as obtained from company records, personally administered surveys, or
participant,observer techniques, and a marked increase in the use of
large data sets obtained from secondary sources, such as government
data files; a marked decline in practitioner and policy,relevant research
and a noticeable increase in research whose major innovation is thea,
retical, methodological, or data improvement (e. g., achieving an im,
proved estimation technique or a "richer" data set); a marked loss in
historical perspective and awareness of institutional realities; and a nar,
row focus on a small subset of employment relations issues. (For a similar
assessment, see Dunlop 1977; Strauss and Feuille 1981; and Rehmus
1985).
The shift toward science,building entailed both benefits and costs for
the field. The largest gains were registered in the empirical area as
computers, multivariate statistical techniques, and large data sets en,
abled researchers to test hypotheses rigorously and to quantify relation,
ships. Significant advances were made, for example, in determining the
interactive effect of market concentration and union density on indus,
trial wage levels (Weiss 1966), the impact of employer tactics on union
success in NLRB elections (Getman, Goldberg, and Herman 1976),
and the efficacy of various methods of third,party dispute resolution
(Kochan et al. 1979). Although less faNeaching, theoretical advances
were also obtained, such as models of union wage policy (Atherton
1973), bargaining and strikes (Cross 1969; Ashenfelter and Johnson
1969), and the dynamics of arbitrator behavior (Farber and Katz 1979).
Science,building, while arguably a boon to the advancement of

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 Hollowing Out of Industrial Relations

knowledge, was unquestionably a detriment to the cohesiveness and

organizational vitality of industrial relations as a field of study. Although
very dissimilar in their theoretical and topical interests, the members
of the PM and ILE schools nevertheless had a common interest in
resolving labor problems and advancing the three goals of efficiency,
equity, and human well-being. Problem-solving was thus the glue that
held the coalition of diverse disciplines together and provided the raison
d'etre for their interaction. When the objective of the field switched to
science-building, the rationale for having a multidisciplinary field of
study diminished significantly, for productivity in theorizing and
hypothesis-testing was furthered by disciplinary specialization, not in-
terdisciplinary collaboration. 17
Thus, science-building unleashed strong centrifugal forces that si-
multaneously weakened the attraction of participation in a multidisci-
plinary field such as industrial relations and increased the incentives to
pursue unidisciplinary research. The result was the hollowing out of the
field as scholars in the behavioral sciences, economics, law, history, and
the other affiliated disciplines went their separate ways. The only groups
that retained an interest in industrial relations were the institutional
labor economists, for whom there was no home discipline to return to,
and the minority of scholars from various disciplines who were interested
in collective bargaining-the residual topic not included in the intel-
lectual domain of the other disciplines.
The decline in the attractiveness of multidisciplinary research had
serious negative ramifications for IR doctoral programs. As research was
becoming more specialized along disciplinary lines, students in IR doc-
toral programs increasingly felt they had to pursue such specialization
in their course work and dissertations if they were to remain competitive
in the job market. IR programs reacted to this threat by permitting
students to obtain more depth in one disciplinary area at the expense
of cross-disciplinary breadth, but this course of action then called into
question the basic rationale for having an interdisciplinary program in
the first place, particularly given the administrative and organizational
complexities of such programs. 18

LACK OF IR THEORY
Industrial relations is recognized as a field of study precisely because
it focuses on an activity-the employment relationship-that is not the

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 Hollowing Out of Industrial Relations

explicit subject of any other academic area. The bane of industrial

relations, and the cause of its second-class academic status, is that the
activity it has selected for investigation does not contain any common,
unifying process or form of behavior around which a unique theory can
be built and a set of hypotheses deduced. As aptly expressed in the
quotation by Chamberlain cited earlier in this chapter, the employment
relationship covers such a wide number of subjects that the only intel-
lectual common denominator is labor (or work). There is nothing in-
trinsic to the subject of work, however, that provides the basis for a
theoretical model per se. This being the case, a process of disintegration
takes place as researchers return to their home disciplines where con-
ditions are better for science-building and, simultaneously, the subject
area of the employment relationship gets carved up and the pieces
transferred to those disciplines with the greatest comparative advantage
in theorizing.
A portion of the hollowing out of industrial relations in the 1960s
and 1970s was due to exactly this process. The first casualty was the
confederation between the PM and ILE schools. As long as members
of both the PM and the ILE were engaged primarily in applied research
of a problem-solving nature, they had a common reason to work to-
gether, despite their divergent disciplinary perspectives. When science-
building became the dominant goal of research, however, the gains from
joint collaboration were reduced dramatically since the incompatibility
of the theoretical frameworks made cross-disciplinary research both un-
productive of new hypotheses and very time-intensive.
In some respects, in fact, the theoretical frameworks of the behav-
ioralists and the economists were not only incompatible but also an-
tagonistic from a science-building perspective. As I have argued
elsewhere (Kaufman 1989b), the outcomes of the employment relation
reflect the interaction of objective, external conditions (technological,
economic, legal) and the human response to those conditions, which
is shaped by internal, subjective psychological and sociological variables.
If a theory is to be a true theory, it must treat one of these two factors
as a given so as to derive falsifiable predictions ex ante.
Thus, in behavioral research of the PM school, researchers tend to
view the external environment, and variations thereof, as the given and
to search for explanations of the change (or level) in IR behavior in
internal social, psychological, and organizational conditions (e.g., dif-

129
 Hollowing Out of Industrial Relations

ferences in leadership styles, corporate strategies). The economics per-

spective of the ILE school pursues the opposite approach. It takes internal
social, psychological, and organizational conditions as the given and
looks to external conditions (e. g., variations in the rate of unemploy-
ment, changes in the technology of production) for the causal or in-
dependent variables.
This dichotomy in perspectives was the fundamental source of dis-
agreement in the 1950s between the advocates and critics of human
relations. Gerald Somers later gave voice to the intellectual conundrum
this opposition of viewpoints creates when he remarked (1969:40) that
"the great need is for a vehicle by which the extemalists (economics,
law, and politics) and the internalists (psychology and sociology) can
integrate their efforts" (also see Somers 1972). He failed to grasp the
extent of this conundrum, however, for he devoted the remainder of
his article to an attempt to achieve such an integrated theory, a task
that had he succeeded would have simultaneously neutered the predic-
tive ability of the theory he was attempting to build.
Once science-building became the raison d'etre of academic research,
it was inevitable that the ILE and PM schools would go their separate
ways. Unfortunately, this process occurred not only between the PM
and ILE schools but also within them. Just as the theoretical perspectives
of economics and psychology were incompatible, so too were the ties
between such erstwhile allies as sociology and psychology and economics
and law. The result was a progressive weakening of the bonds that held
the coalition of disciplines together.
Carried to its logical extreme, the process of science-building will
result in the total demise of any multidisciplinary field. The good news
for industrial relations is that this process has not happened-yet. Al-
though most of the other parts of the employment relationship were
stripped away and appropriated by other disciplines, collective bargain-
ing remained the intellectual property of industrial relations. The bad
news is that industrial relations gained jurisdiction over collective bar-
gaining by default; that is, not because IR developed its own theoretical
framework to explain collective bargaining processes and outcomes but,
rather, because other disciplines were also unable to do so.
It follows from this fact that industrial relations is not secure until it
independently develops a theoretical framework that can explain the
major features of labor-management relations (or whatever other area

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 Hollowing Out of Industrial Relations

is at the core of the field). Lacking such a framework, industrial relations,

perforce, will remain a multidisciplinary field of study. This situation is
clearly an intellectual weakness, not a virtue, in an environment of
science-building. It also explains why industrial relations has had a
stronger orientation toward the discipline of economics in the post-
World War II period than in earlier years. The reason is that the field's
current focus on collective bargaining makes it more amenable to eco-
nomic theorizing than when the field encompassed the entire employ-
ment relationship.

CURRENT EVENTS
The hollowing out of industrial relations that occurred after 1960 was
further abetted by the tum of current events.
Part of the perceptible malaise that seemed to descend on the field
in the early 1960s was no doubt due to the realization among IR scholars
that current events had shoved industrial relations off the center stage
of public concern. When the nation's attention was riveted on issues
of strikes and union power, as it was in the late 1940s and early 1950s,
students and researchers flocked to industrial relations, imparting to it
a sense of both importance and excitement. By the early 1960s, however,
labor-management relations had gone from being front-page news to
being back-page news as collective bargaining became institutionalized
and routinized and strikes and other attention-getting forms of conflict
dropped to the lowest levels since the early years of the Depression. As
the spotlight of public attention shifted to other economic and social
problems, IR academics inevitably felt some angst as they contemplated
declining student enrollments in graduate programs and a body of re-
search topics that was looking increasingly picked over and pedestrian.
As labor-management relations receded in newsworthiness and policy
concern, other labor-oriented issues took their place, including auto-
mation and structural unemployment, discrimination and civil rights,
job dissatisfaction and alienation among blue-collar workers, poverty,
and manpower training programs. All of these issues were labor problems
and thus fully in the intellectual domain of industrial relations. They
were also well suited to the field's multidisciplinary focus, involving as
they did a diverse range of economic, organizational, political, and social
influences.
Were industrial relations truly a problem-solving field, it would have

131
 Hollowing Out of Industrial Relations

gone with the headlines {per the critics' charges) and made these topics
the new focal point of research. Efforts were made in this direction, but
in the final analysis they did not quite gel. It is certainly clear, on the
one hand, that IR academics gave these new labor problems considerable
attention in the 1960s and 1970s. For example, the IRRA devoted
several sessions at its annual winter meetings to these subjects and
published research volumes on adjustments to technological change
(Somers, Cushman, and Weinberg 1963), poverty {Levitan, Cohen,
and Lampman 1968), manpower training programs {Weber, Cassell,
and Ginsburg 1969), and civil rights (Hausman et al. 1977). On the
other hand, as the IR literature makes clear, collective bargaining re-
mained the heart and soul of industrial relations. The new issues were
the "swing" topics in IR in that they waxed and waned in research
importance based on their newsworthiness. Thus, automation was a
prominent subject in the early 1960s, while poverty had its day in the
late 1960s and early 1970s and then faded from sight. The one subject
that was always given attention at every IRRA meeting and in nearly
every issue of the IR journals, however, was collective bargaining.
The emergence of collective bargaining in the 1970s as the core
subject area of the field was unfortunately timed from the perspective
of current events. Just as industrial relations became increasingly asso-
ciated with the study of collective bargaining, the extent and influence
of collective bargaining noticeably began to decline. Union density, for
example, dropped from 32 percent of the work force in 1960 to 25
percent in 1980. Further, the bulk of the pioneering innovations in
employment relations practices no longer came from the union sector
but from a small but growing number of nonunion companies that were
successfully applying behavioral science-based human resource and or-
ganizational development methods {see Foulkes 1980; Beer and Spector
1984; Kochan, Katz, and McKersie 1986).
Thus, quite apart from the pressures of science-building and the lack
of IR theory, industrial relations would have lost some of its organiza-
tional vitality as a result of the gradual decline in size and influence of
the union sector of the economy. In the late 1970s, these developments
did not seem unduly worrisome, however, and there were even reasons
for modest optimism. Union representation and power, for example,
remained strong in such core areas of the economy as mining, construc-
tion, manufacturing, and transportation. Similarly, although union

132
 Hollowing Out of Industrial Relations

membership as a percentage of the work force had declined, union

membership itself had increased by 5 million-hardly the sign of a
decaying institution. Finally, one of the major employment relations
developments of the 1960s-70s was the spread of unionism and collective
bargaining to the public sector. This development created a substantial
agenda of new labor problems that needed investigating (e.g., alter,
natives to the strike as a method of dispute resolution; the juxtaposition
of the economic and political power of public sector unions), thus pro,
viding IR academics with new grist for their research mills and a renewed
sense of purpose for the field.
Current events must be rated, therefore, as a modest cause of the
field's hollowing out in the 1960s-70s. As we shall see, however, the
1980s were a far different story.

VALUES
Industrial relations has always been animated by a distinct value
system and ideology that have given purpose and direction to the field
(Weber 1987a). The community of interests that draws people to a field
and that provides the focal point for research and teaching has been
weaker in industrial relations than in many other fields because of the
vastness and diversity of the subject matter and the lack of an integrating
theoretical framework. Industrial relations, therefore, has had to rely to
a greater degree than other fields on ideology and values to provide the
bonds of association and the sense of shared purpose. 19
The ideology of industrial relations in its early, pre-World War II
years was reformist and progressive. Both the institutional labor econ,
omists and the personnel practitioners who founded the field were drawn
to it by the conviction that the prevalent methods of organizing work
and managing the work force resulted in a deplorable amount of waste,
inefficiency, human suffering, and enmity between workers and em,
ployers. They also agreed that these evils could be, and should be,
eradicated through a combination of improved management methods,
the introduction of industrial democracy into the workplace, and the
enactment of protective labor legislation and social insurance programs.
This reform agenda was broad enough to accommodate a diversity of
viewpoints. Thus, the members of both the PM and the ILE schools
were committed to the idea that some system of shared governance was
an essential part of the reform of the employment relationship but they

133
 Hollowing Out of Industrial Relations

diverged on the best method to achieve it. As discussed in chapter 2,

the PM wing of the field was generally hostile to trade unions and
collective bargaining and favored a nonunion form of employee repre-
sentation, while the ILE wing was far more supportive of trade unions
and skeptical of the effectiveness of company unions. The important
point is that the ideology and value system of industrial relations was
framed broadly enough during this period that people as diverse as John
R. Commons, Clarence J. Hicks, and Elton Mayo could all find common
ground for collaboration.
This situation began to change in the 1950s. On the one hand, the
field continued to include people with a diversity of viewpoints con-
cerning employer-employee relations, as evidenced in the vigorous de-
bate surrounding human relations. On the other hand, it is also clear
that a gradual process of disenfranchisement took place in the 1950s as
the members of the PM wing were given less than an equal opportunity
to participate by the labor economists and their allies who controlled
the journals and professional meetings of the field. 20
In the pre-World War II period, IR's atomized, largely noninstitu-
tionalized state made it impossible for the ILE or the PM contingent to
gain political control of the field. This situation changed dramatically
after 1945 with the creation of the IR institutes, the IRRA, and the
ILR Review. 21 These new organizations had the power to define the scope
and ideological perspective of industrial relations through their control
over the subjects taught in IR curricula, the articles published in IR
research journals and proceedings, and the faculty invited to participate
in professional meetings. This power, as we have seen, passed into the
hands of the ILE wing of the field. The inevitable result was that the
institutions of the field were used to promote the ILE version of industrial
relations over the PM version, a fact that contributed significantly to
the eventual divorce of the two in the 1960s. 22
With the ILE school in control, the value system of industrial relations
became synonymous with the value system of the leading thinkers of
that school. Somers (1975:1) describes the components of this value
system as "the uniqueness and value of the free collective bargaining
system, voluntarism, liberal pluralism, [and] consent." Barbash
(1979:453) says of it: "As I see it, two leading principles govern the
American ideology of American industrial relations: the adversarial prin-
ciple and the principle of voluntarism." Finally, Franke (1987:479)

134
 Hollowing Out of Industrial Relations

states, "It is probably fair to say that the distinctive character of many
[IR] programs has been the study of trade unionism and collective bar,
gaining and the value system that supported these institutions."
These statements elicited neither debate nor controversy. They had
become, in effect, the reigning orthodoxy of industrial relations. The /
ideological character of industrial relations had gradually but perceptibly
changed from broad,based, middle,of,the road progressivism to a more
narrow, liberal, leaning, pro,union perspective. 23 This change in ideo,
logical orientation, in turn, contributed to the hollowing out of the field
in several ways. First, the ILE ideology effectively narrowed the com,
munity of interests that defined the field and thus made involvement
in industrial relations unattractive to many potential participants. Sec,
ond, it led to the falloff in student enrollments and scholarly interest
in industrial relations due to the decline in the union sector of the
economy and the concomitant growth of the nonunion sector and hu,
man resources as a field of study. Third, the ILE commitment to unions
and the New Deal system of industrial relations caused a growing number
of people to see the field as increasingly stale, reactive, and out,of,date.
Fourth and finally, the field became less interesting when members of
the PM school left and the debates over theory and policy, such as
occurred in the 1950s over human relations, largely ceased.

135
 7
INDUSTRIAL RELATIONS IN
DECLINE

A LTHOUGH THE LAST chapter painted a less than optimistic pic,

ture of the prospects for industrial relations as a field of study,
from the vantage point of 1980 the dark clouds were less obvious
and threatening. In their review of industrial relations research, for
example, Strauss and Feuille (1981) concluded that the academic for,
tunes of the field appeared to have bottomed out in the mid, 1970s and
then staged a modest revival, possibly presaging a "renaissance" for the
field. Likewise, the consensus at a 1982 conference entitled "The Future
of Industrial Relations" was that "despite the fact that major elements
of the U.S. industrial relations environment have changed or are chang,
ing, the conferees expected no fundamental shifts in the industrial re,
lations system itself. While most participants had no clear scenario as
to how continued membership declines could be avoided, most expected
a new surge of organizing to occur, as it had so often in the past"
(Industrial Relations, Winter 1983:126).
From the vantage point of the early 1990s, it is clear that just the
opposite occurred. While the quality and quantity of scholarly research
in industrial relations improved, this "plus" was outweighed by several
"negatives" that clearly signaled an overall decline in the intellectual
and organizational vitality of the field. These developments included a
dramatic decade,long decline in union membership and union power,
significant attrition in the number of extant IR institutes and degree
programs, a marked shift in student demand from IR to HR courses, a
widespread perception among both academics and practitioners that IR
had lost much of its relevance as an agent for change and innovation

I 37
 Industrial Relations in Decline

in employment practice and policy, and a marked stagnation in mem-

bership and participation in the Industrial Relations Research Associ-
ation. This tum of events, and the pessimistic mood it generated among
IR scholars, is amply illustrated in another review of the field that Strauss
undertook in the late 1980s (1989:241, 257): "The news is more bad
than good .... Short of an unexpected resurgence of union victories
academic IR will have to make major readjustments. Otherwise it may
follow the example of the Cigarmakers and Sleeping Car Porters, both
leaders of their times."
A review of developments in academic IR during the 1980s does tum
up more bad news than good, at least if one's attention is restricted to
the United States. 1 In analyzing these developments, the first place to
start is current events.

THE NEW DEAL IR SYSTEM IN CRISIS

The legislative initiatives of the New Deal period, such as the
Wagner Act, the Fair Labor Standards Act, and the Social Security
Act, along with the Employment Act of 1946, implemented the major
planks of the ILE program for improved industrial relations. By the
mid-1950s, the New Deal system was largely institutionalized in the
American economy. The pillar of this system and its major dynamic
element was collective bargaining. Unions had succeeded in organizing
one-third of the total work force and more than half of the blue-
collar workers in the goods-producing industries. Collective bargaining
was without question the pacesetter in the economy in both the
determination of wages and working conditions and innovations in
employment practices. Union-management bargainers pioneered, for
example, cost-of-living adjustment (COLA) clauses, multiple-year con-
tracts, supplemental unemployment plans, and binding arbitration of
employee grievances.
From the mid-1950s until the late 1960s, the New Deal system per-
formed remarkably well. Unions achieved considerable success: collec-
tive bargaining led to substantially improved wages, benefits, and
working conditions, making a middle-class lifestyle available to a large
cross-section of blue-collar families; unions (or the threat of unions)
induced companies to systematize and formalize their personnel policies
and to improve their training of supervisors and foremen; and unions
created a fundamentally new and more equitable system of workplace

138
 Industrial Relations in Decline

governance featuring formal grievance procedures, protection from ar,

bitrary discipline and discharge, and joint consultation over the terms
and conditions of work.
All of these changes increased labor costs for firms, as did the various
protective labor laws and social insurance programs through periodic
increases in standards, coverage, and benefits. Nevertheless, the system
was compatible with low inflation and relatively strong output growth
as a result of the low strike rates, stable fiscal and monetary policies,
and, most important, strong increases in productivity. This increase in
productivity was itself partially a result of the IR system in that collective
bargaining demands forced firms to improve management methods,
streamline the production process, and adopt new technologies and
capital equipment.
From the vantage point of the early 1970s, it appeared that the
unionized sector of the economy would remain the dominant influence
in employment relations, particularly given the rapid spread of collective
bargaining in the public sector: In hindsight, it is clear that the tradi,
tional IR system was, in fact, already slipping in power and influence
while an alternative, nonunion system was rapidly gaining momentum
(Kochan, Katz, and McKersie 1986). The extent of the decline of the
former and the growth of the latter would not come into stark relief,
however, until the 1980s.
The fundamental problem facing the union sector in the 1970s was
the gradual loss of economic competitiveness as a result of developments
both at the bargaining table and on the shop floor. During the decade
union bargainers were able to win wage and benefit increases that far
outpaced those obtained by nonunion workers. The result was a sub,
stantial increase in the union,nonunion labor cost differential (G. John,
son 1984; Kaufman and Stephan 1987). Unionized firms could still
compete effectively if they could offset the growth in payroll costs with
concomitantly greater gains in productivity (thus holding unit labor
costs constant). Unfortunately, as the percentage increase in compen,
sation costs began to escalate into the double,digit range, the growth
rate of productivity plummeted. There are many reasons for this slow,
down, but the increasingly outmoded, bureaucratized, and restrictive
system of managing work in unionized firms was certainly a factor, as
was the increase in government regulation of the workplace (Denison
1985; Gray 1987).

139
 Industrial Relations in Decline

The result of this divergent trend in compensation costs and produc~

tivity gains was that unionized firms experienced significant pressure on
their profit margins. To protect their profits, firms raised their prices,
restricted new capital investment and/or product development, disin~
vested in unionized facilities and built new, nonunion plants, further
automated production, and used other such methods {Hirsch 1991).
During the 1970s economic growth was sufficiently strong, and barriers
to lower cost competition sufficiently high, that the resulting decline
in union density {membership as a percentage of nonagricultural em~
ployment) was modest (27 to 23 percent). It was clear, however, that
the New Deal IR system was under stress and showing signs of atrophy.
Stress turned to crisis in the 1980s. The crisis had intellectual, po~
litical, economic and organizational origins.
The central tenet of the ILE policy program-the use of collective
bargaining, government regulation, and activist management of fiscal
and monetary policies to ensure competitive economic outcomes and
industrial democracy-suffered a significant decline in intellectual sup~
port. In many ways the attack on the ILE program was a counterrevo~
lution by the modern~day adherents of classical economics and the PM
school. In economics, the institutional and neoinstitutional theories of
labor markets, with their emphasis on labor market imperfections and
inequality of bargaining power, were largely supplanted by the Chicago~
based neoclassical theory with its emphasis on the virtues of free markets
and competition. Viewed from a neoclassical perspective, unions, gov~
ernment regulation, and activist monetary and fiscal policies were un~
desirable institutional interventions that caused economic inefficiency
and the redistribution of income to various interest groups. 2 Economists
were also increasingly skeptical whether full~employment fiscal and mon~
etary policies and extensive collective bargaining coverage were com~
patible with low inflation. ILE economists advocated a resolution of this
contradiction through further government intervention in the form of
"incomes policies" (e. g., wage~price controls), an idea that was rapidly
losing support during the 1970s among both economists and pol~
icymakers.
Many management and behavioral science scholars also lost faith in
the ILE policy program. In this case the theoretical inspiration for
revisionism came from the related fields of organizational behavior, or~
ganizational development, and human resource management (Beer and

140
 Industrial Relations in Decline

Spector 1984; Walton and Lawrence 1985; Lawler 1986). These fields,
often lumped together under the label human resources, were the 1980s
version of the PM school that had originated in the 1920s. 3 Like their
forebears of the 1920s, HR scholars were unenthusiastic about labor
unions and most forms of government regulation of the workplace. As
they saw it, unions and government regulation were antithetical to
economic efficiency and job satisfaction because they institutionalized
adversarialism, stifled work effort and creativity, and promoted a rigid,
bureaucratized, and litigious system of workplace organization. Harking
back to the basic ideas developed by the personnel practitioners of the
1920s and the human relations academics of the 1930-50s, these scholars
sought to eliminate adversarialism and promote a "win-win" outcome.
The result, they thought, would be higher economic performance for
the organization and greater economic and psychological rewards for the
individual, achieved through the development and implementation of
a "commitment model" of workplace organization in which a congruence
of interests would be established between workers and the organization
through the use of a consensual leadership style, participative methods
of management, group production methods, pay-for-performance com-
pensation systems, and a formalized method of dispute resolution.
The political environment in the 1980s also turned hostile to the
New Deal IR system. The election of Ronald Reagan to the presidency
in 1980 precipitated a significant tum toward political conservatism with
respect to government labor policy. Reagan was an outspoken champion
of free markets and of minimalist role for government, a philosophical
belief that was at direct odds with the ILE policy program erected over
the previous half-century. Over the next decade the Reagan adminis-
tration, and to a lesser degree that of George Bush, implemented several
policy initiatives that struck at the heart of the New Deal system. The
organizing ability and bargaining power of labor unions, for example,
were heavily circumscribed by adverse changes in the interpretation of
law and precedent by the National Labor Relations Board (Weiler 1990).
Similarly, Reagan's decision to fire the air traffic controllers when they
went on strike in 1981 was widely interpreted as sending a signal to
private sector employers that it was alright to play hardball with unions.
Reagan and Bush also sought to eliminate or soften numerous workplace
regulations or protections, such as the minimum wage and occupational
safety and health laws. As a final insult, the Reagan administration

141
 Industrial Relations in Decline

seldom consulted union leaders on matters of national economic and

social policy, effectively abrogating the tripartite labor~management~
government system of social bargaining.
The adverse economic environment in the 1980s also contributed to
the decline of the New Deal IR system. Although the cost and pricing
structure of unionized firms became increasingly uncompetitive during
the 1970s, their survival was protected by both modestly strong growth
in the domestic economy and various barriers to entry in the product
market that largely shielded them from the competitive threat posed by
lower~cost rivals. Four economic events occurred in the 1980s, however,
that exposed these firms to far greater competitive pressures: the back~
to~back recessions of 1980 and 1981-82; the deregulation of such key
industries as transportation and communication (a policy initiated by
the Carter administration); the emergence of a significant nonunion
segment in several hitherto heavily unionized industries as a result of
the building of new plants in the South or new "double~breasted" op~
erating divisions; and the considerably heightened level of international
competition, precipitated in part by the sharp appreciation of the dollar
in the first half of the 1980s. The results of these events were large~
scale layoffs, plant closings, and bankruptcies among unionized firms,
reflected in a plunge in both employment and union membership in the
heavily organized goods~producing sector of the economy.
Finally, organizational developments, particularly with respect to
management practices and strategies, played an important role in the
decline of the New Deal IR system. By most accounts, American man~
agement became far more determined to operate nonunion (D. Mills
1981; Kochan, Katz, and McKersie 1986; Barbash 1986). This strategy
was pursued along two tracks (Cappelli and Chalykoff 1985). One track
was "union substitution," whereby companies practiced progressive em~
ployment relations in an attempt to eliminate workers' desire for a union.
The epitome of this approach was the implementation of the HR~
inspired commitment model of work organization. The second track was
"union suppression," whereby companies tried to discourage or frustrate
workers in pursuit of unionization by the use of threats of reprisal and
job loss, illegal firings, and extended litigation. Permanently replacing
strikers, a move that undercut the fundamental source of union power,
was another key part of the management strategy.
The net effect of these events and developments was that they plunged

142
 Industrial Relations in Decline

the New Deal IR system into crisis, the brunt of which was home by
the union movement. Between 1979 and 1989, unions lost almost 5
million members and saw the proportion of the organized work force
shrink from 23 to 17 percent. More ominously, by the late 1980s, unions
were able to win fewer than 100,000 new members through the NLRB
representation election process, while many times that number were
lost through decertifications, plant closing, layoffs, and striker replace,
ment (Freeman 1988). In effect, the organized labor movement was
slowly being bled to death and its dwindling band of intellectual and
political supporters were powerless to reverse the process. Not since the
1920s had the prospects for organized labor looked so bleak (Dubofsky
1985). Meanwhile, the American economy generated more than 19
million new jobs over the decade, almost all in nonunion firms. The
message was clear: the New Deal IR system, and the collective bargaining
process at its core, was rapidly shrinking in size and importance, while
the nonunion sector of the economy was increasingly becoming the
dynamic source of both new jobs and new ideas. Not unexpectedly,
these trends reverberated strongly through academia, with doleful con,
sequences for the field of industrial relations.

AcADEMIC PROGRAMS IN THE 1980s

Viewed broadly, the 1980s was a period of significant growth for
academic programs specializing in employmenHelated subjects. For ex,
ample, Georgianna Herman ( 1984:A,5) found that the number of master
of arts and master of science degree programs in personnel, industrial
relations, and human resource management grew from twenty,six in
1974 to sixty,six in 1984. 4 The number of Ph.D. degree programs in
these areas more than doubled, from six to fourteen. Similarly, Joseph
Krislov and John Mead (1987) conducted a survey of IR and HR pro,
grams in the mid,1980s and found that of the seventy,seven units in
their sample, twenty,three had been established in the 1970s and nine
in the 1980s. Finally, a directory published in June 1988 by Personnel
Journal of universities in the United States with HR and IR programs
or majors lists more than 150 entries. 5
These trends are both good and bad news for academic IR. The good
news is that a rising tide raises all boats, and one benefactor of increased
student demand for employment,related subjects was the major IR ac,
ademic programs. The foundation of academic IR is the multidiscipli,

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 Industrial Relations in Decline

nary, degree-granting IR units, such as those at Cornell, Minnesota,

Illinois, Wisconsin, Rutgers, and Michigan State. (Other important IR
units, such as the ones at Berkeley and UCLA, sponsor only research.)
These programs have large and distinguished faculties and good to ex-
cellent reputations in the academic marketplace. Thus, even as em-
ployment in the unionized sector of the economy plummeted in the
1980s, the top-tier IR programs not only survived the decade intact but
actually experienced a modest increase in graduate enrollments. Un-
published data collected by the University Council of Industrial Rela-
tions and Human Resource Programs (the former IR center directors'
group) also indicates that IR doctoral students continued to fare well
in the academic job market.
The bad news for academic IR is that even in an expanding market
the best the top-tier programs could do was hold their own, while smaller
or lesser-known programs suffered considerable slippage. A major prob-
lem was that student demand for employment-related courses shifted
sharply toward the HR end of the spectrum and away from the IR topics
(narrowly defined) that had traditionally dominated IR curricula. Walter
Franke (1987:476) documents, for example, that in the 1950s more than
half the elective courses chosen by graduate students of the Illinois IR
program were in the labor-management relations area, while only slightly
more than one-third of such courses were in personnel and OB. Thirty
years later, the proportions were almost reversed.
In a similar vein, Charles Rehmus (1985:592), the former dean of
the program at Cornell, observed that "demand for courses and faculty
in the fields of personnel, human resources administration, and orga-
nizational behavior has roughly doubled in the last decade." Reasons
for this demand shift include student perceptions that better job op-
portunities await graduates with concentrations or majors in HRM and
OB; the negative stigma carried by the IR label in the job market because
of its association with unionism and a pro-collective bargaining ideology;
the sizable growth of enrollment in business schools, which tend to give
more emphasis to HR-related courses; and the accreditation require-
ments of the American Association of Collegiate Schools of Business,
which mandate that master of business administration curricula require
at least one organizational behavior course, but have no such require-
ment concerning IR (Begin 1987; Franke 1987, Fossum 1987; Lewin
1988a). 6

144
 Industrial Relations in Decline

The impact of this shift in demand toward HRM and OB courses and
majors varied across programs and universities. The top-tier IR programs
experienced the least disruption of their basic structures and identities.
Several circumstances worked in their favor. First, these programs al-
ready offered concentrations and extensive coursework in HR, so it was
relatively simple (internal politics aside) to augment the HRend of the
curriculum and faculty. Second, they already had excellent reputations
and thus employers continued to seek out their graduates despite the
negative stigma of the IR label, and students continued to apply to these
programs given their good record of job placement. Third, nearly all of
the top-tier IR programs were in states with a relatively high level of
union density, providing both greater job opportunities for students with
an IR degree and greater political clout from organized labor to protect
funding for the programs.
Programs that were smaller, less well known, or located in states with
low union densities often had to make bigger adjustments. One common
practice was to drop the IR label from the name of the program, in
favor of some HR-related alternative, such as Personnel and Employment
Relations (Georgia State) or Human Resources Institute (Alabama). 7
Other programs kept the IR label but added an HR-related term. Loyola
University (Chicago), for example, changed the name of its institute
from Industrial Relations to Human Resources and Industrial Relations.
In either case, the basic multidisciplinary structure of the program was
preserved, but at the cost of abandoning the original "all aspects of
employment relations" meaning of the IR label.
Still other programs were forced to make more wrenching adjustments.
The shift in student demand toward HR subjects, the decline of inter-
disciplinary (or even multidisciplinary) research in employment rela-
tions, and the loss of the membership and political power of labor unions
all eroded the original justification for free-standing IR units. As cur-
ricula and student enrollments shifted toward HR subjects, these units
increasingly came to resemble the personnel and OB wing of a traditional
department of management (Begin 1987). Likewise, as faculty research
became ever more specialized in focus because of the continued pressures
of science-building, faculty interest and participation in cross-
disciplinary activities waned and universities began to examine whether
the research payoff of an interdisciplinary unit was worth the admin-
istrative complexities and costs.

145
 Industrial Relations in Decline

Finally, the sharp drop in the size of the union sector and in the
number of job opportunities in labor~management relations called into
question both the need for and the viability of IR programs, while the
erosion of organized labor's political power made it far easier for uni~
versity administrators to consider the once unthinkable-shuttering or
significantly restructuring the programs.
The result was that free~standing IR units were merged or absorbed
into business programs or departments. The experience of theIR unit
at Purdue University is typical.
In 1957, an interdisciplinary body offaculty from across the Purdue
campus was organized to administer M.S. and Ph.D. programs in in~
dustrial relations. According to James Dworkin ( 1988:462-63), the pro~
gram originally had a heavy labor relations orientation, although some
coursework in personnel management was offered. Over the years several
changes were made to the program. In 1962, it was transferred to the
business school. Then, in 1967, the interdisciplinary Ph.D. program
was eliminated because of a lack of participation by faculty. Next, the
program was restructured so that more general business courses were
required (partly in response to accreditation pressures). Concurrently,
the number of traditional IR courses offered was reduced. Finally, in
1986, the title of the M.S. program was changed from industrial relations
to human resources management. Currently, this program, as well as
the Ph.D. program in organizational behavior and human resources
management, is taught by faculty from the business school's Department
of Organizational Behavior and Human Resources Management. Stu~
dents in the M.S. program are required to take sixteen courses, of which
five are OB and HRM courses, four are general management courses,
four are research methods courses, one is a labor economics course, one
is a labor law course, and one is a collective bargaining course.
The end result is that industrial relations has disappeared from the
name of the program at Purdue and the program has been relocated to
the business school and has a substantial management orientation. The
proportion of coursework devoted to the ILE perspective on industrial
relations, and to union~related topics in particular, has also been reduced
significantly. The program continues to include coursework from both
economics and the behavioral sciences, but the proportion of work in
the behavioral sciences has been expanded significantly while the rel~
ative contribution of economics has been reduced (labor economics is

146
 Industrial Relations in Decline

now only one course out of sixteen). Finally, the multidisciplinary char-
acter of the curriculum and faculty has also been significantly reduced.
During the 1980s the structure and curriculum of a number of other
IR programs were changed in much the same direction as at Purdue. 8
Whether these changes are to be welcomed or lamented is, in large part,
a matter of personal opinion. Advocates of the ILE school generally
regard these developments as a quasi disaster in that they threaten the
survival of the IR label, the interdisciplinary approach to teaching and
research, and the intellectual and ideological emphasis on the adversarial
relationship, collective bargaining, and accommodated conflict. Most
advocates of the PM (HR) school, however, welcome these changes as
a long overdue shift from an outdated 1930s-era approach to the subject
of employer-employee relations to a modem, progressive approach that
is consistent with both the revolution in behavioral science research
and the economic realities of the marketplace. Whatever one's position,
clearly academic IR programs in the United States are undergoing a
fundamental transformation that represents a renaissance for the PM
school and an eclipse of the ILE school.
The forces discussed above that so significantly affected IR programs
in the 1980s also affected the birth of new IR units. For all intents and
purposes, the creation of free-standing, degree-granting IR units with
multidisciplinary faculties came to a halt. To the best of my knowledge,
no such unit with industrial relations in its title was created in the 1980s. 9
The creation of IR degree programs and majors also slowed to a trickle.
Herman's surveys of IR and HR programs (1984) reveal that of the net
increase of forty-three master's degree programs between 1974 and 1984,
only eight included one or more of the terms industrial relations, labor
relations, labor studies, or employee relations in their titles, while the
remainder included one or more of the terms personnel, human resource
(or human relations), organization, or management. In some cases these
new programs were multidisciplinary in character, but more often they
were housed in a department of management or a graduate school of
business and provided a largely behavioral science, nonunion perspective
on employment relations.
Finally, even as the birth of new IR units was coming to a standstill,
a simultaneous increase in the "death" or downsizing of existing units
was occurring. Some universities, such as Columbia, Chicago, and Pace,
chose to eliminate their programs altogether. Other schools, such as

147
 Industrial Relations in Decline

Michigan, Berkeley, and Massachusetts, reduced the operating budgets

and/or the number of faculty positions of their IR units significantly. In
both cases, the IR units had become vulnerable to the budget ax because
they served a subject area and constituency that university administrators
increasingly regarded as of marginal importance.

IR RESEARCH
The bright spot for industrial relations in the 1980s was research. By
most accounts (e. g., Strauss and Feuille 1981), IR research suffered
through a period of the doldrums in the 1960s and early 1970s and
reached an intellectual and creative nadir sometime in the middle of
the decade. As I perceive it, IR research then staged a modest rebound
that persisted through the 1980s.
The clearest case of a rebound is in IR-related research monographs.
The "big book" of the 1960s was Richard Walton and Robert McKersie's
A Behavioral Theory of Labor Negotiations (1965). It is not clear what
book would be selected for the 1970s, for although several are certainly
high-quality works of scholarship (e.g., Getman, Goldberg, and Herman
1976), none is recognized as an IR "classic."
In the 1980s, however, several monographs significantly influenced
industrial relations teaching and research and are likely to be cited by
IR scholars for many years to come. They are (in chronological order)
The Elements of Industrial Relations (1984), by Jack Barbash; What Do
Unions Do? (1984), by Richard Freeman and James Medoff; and The
Transformation of American Industrial Relations (1986), by Thomas Ko-
chan, Harry Katz, and Robert McKersie.
A common characteristic of these three books, and of IR research in
general during the 1980s, was the renewed interest in theory-building. 10
This must rank as one of the most heartening developments of the
decade. Before the 1980s, there was much decrying the lack of IR theory
but few attempts to remedy the deficiency. The most notable attempt
at theorizing was Dunlop's Industrial Relations Systems (1958). A second
effort worth mention was by Gerald Somers (1969). Somers argued that
the process of exchange is the common denominator that underlies all
behavior in the employment relationship and that the analysis of ex-
change can provide the integrating framework needed by the field. His
ideas never caught on, however.
After the appearance of Somers's work, the subject of theory was

148
 Industrial Relations in Decline

rarely addressed in the United States for the next decade (but see Hills
1975). 11 As the field headed into the 1980s, however, theory-building
again moved to the fore, partly as a response, no doubt, to the field's
sagging intellectual fortunes. The first contribution in this regard was
Thomas Kochan's book Collective Bargaining and Industrial Relations
(1980). Although ostensibly written as a textbook, Kochan used it as
a vehicle to address larger issues, particularly the integration of view-
points and research findings from labor economics, industrial relations
(institutionalism), and the behavioral sciences. 12
Kochan's next effort, co-authored with Harry Katz and Robert
McKersie, was The Transformation of American Industrial Relations. The
book's major intellectual contribution is its development of a three-tier
strategic choice framework to analyze the evolution and interaction of
the union and nonunion sectors of the economy. This framework over-
laps with Dunlop's in that it emphasizes the importance of the external
economic and political structure in which the industrial relations system
is imbedded, but it also elaborates on the different levels of decision-
making in the system, the role of business strategy, and the interde-
pendency of the union and nonunion sectors. 13 As a result of these two
books, plus numerous other research contributions, Kochan came to be
widely regarded as the leading research figure of the younger generation
in industrial relations.
Another person who made significant contributions to IR research in
the 1980s is labor economist Richard Freeman. Freeman is an indefa-
tigable writer whose articles and books on various aspects of unions and
collective bargaining are often cited. Of these, the most important is
What Do Unions Do, co-authored with James Medoff. The book's major
conceptual contribution is the exit/voice model of trade unionism. The
basic idea is that unions, by providing workers with a formalized channel
for making grievances, complaints, and suggestions, can contribute to
increased economic efficiency through lower quit rates, higher produc-
tivity, and improved management practices. All of these factors are
often ignored or underestimated in the standard neoclassical "union as
a monopoly" analysis. 14 The book is also notable for its use of an im-
pressive array of data sets and advanced econometric methods to analyze
the impact of unions on a wide range of economic outcomes, such as
wages, fringe benefits, quit rates, productivity, and income inequality. 15
Jack Barbash, an institutional labor economist and emeritus professor

149
 Industrial Relations in Decline

at the University of Wisconsin, also made important theoretical con-

tributions to IR research in the 1980s. Barbash has been the major
chronicler of the ILE theory of industrial relations and the expositor of
the contributions of Commons to the development of the field. His most
important scholarly work is The Elements of Industrial Relations (1984).
The book identifies the origins of labor problems in the employment
relationship and then analyzes the response of management, workers,
and government to these problems. According to Barbash, labor prob-
lems originate in the clash between management's drive for efficiency
and workers' deep-felt needs for security. These needs lead workers to
seek various restrictive or protective work rules and regulations, which
are enforced through either the social sanctions of informal work groups
or the economic power of a union. The book represents the most his-
torically accurate and intellectually insightful conceptualization of the
IR paradigm as conceived by the field's founding fathers, albeit with an
overemphasis on the ILE perspective.
Other significant contributions to the development of a theoretical
base for industrial relations include the integrative model of industrial
conflict by Hoyt Wheeler (1985), the employment relations systems
model by James P. Begin (1990), and the models of workplace control
by William Cooke (1985) and Steven Hills (1992). Neither these au-
thors nor the ones cited above discovered the holy grail of industrial
relations (i.e., the integrative theoretical framework that would trans-
form industrhd relations into a bona fide academic discipline), but each
added conceptual substance to a field that desperately needed it. 16
A modest positive trend in the direction of IR research was also
discernible during the 1980s in the field's various journals. Several new
journals were established as forums for IR research, including the Journal
of Labor Research and the Employee Responsibilities and Rights Journal, as
well as a new annual research volume, Advances in Industrial and Labor
Relations. Further, the Industrial and Labor Relations Review made a per-
ceptible effort to broaden its mix of articles (an effort unfortunately not
apparent in the editorial policy of the field's other major journal,
Industrial Relations). There was a greater proportion of articles on per-
sonnel and HRM subjects, historical case studies and behavioral-based
research, as well as symposiums on behavioral research, labor history,
and compensation that attempted to revive the multidisciplinary coa-
lition that had once been IR. 17 Finally, it is my impression that the

150
 Industrial Relations in Decline

theoretical and statistical sophistication as well as the intellectual sub-

stance of the articles in the journals increased over the decade.
Another positive trend was the increased interest among IR scholars
in the impact of management practices and policies on the structure,
performance, and long-term evolution of the industrial relations system.
During the 1960s and 1970s the management side of the employment
relationship largely dropped from sight as an industrial relations research
topic. This relatively one-sided perspective became increasingly unten-
able in the 1980s as it became obvious that companies, not unions, were
the dynamic agents of change in industrial relations (Strauss 1984). The
response was a boomlet of interesting, high-quality research on man-
agement strategy (Kochan, McKersie, and Cappelli 1984; Verma 1985;
Kochan, Katz, and McKersie 1986; Lewin 1987) and the impact of firm
IR and HR policies on profits and productivity (Clark 1984; Voos and
Mishel 1986; Kleiner et al. 1987; Ehrenberg 1990). This literature had
four salutary effects: it brought the subject of management back into
industrial relations; it imparted a more dynamic, long-term perspective
to theorizing in the field; it promoted a cross-fertilization of research
between IR and OB and HRM scholars; and it motivated labor econ-
omists to become interested in such personnel and HRM topics as com-
pensation, the structure of employment contracts, and the promotion
of work effort.
Counterbalanced against these positive developments are several neg-
ative trends. First, there is an ever greater obsession among younger IR
scholars with methodological and data issues, a trend that too often
comes at the cost of relevance and insight. Second, multidisciplinary
and interdisciplinary research remains a rarity in industrial relations,
perpetuating academic parochialism. Third, much academic IR research
is narrowly focused on explaining the minutiae of past or current be-
havior, while little examines such big questions as the appropriateness
of the nation's labor law, the competitiveness of American IR practices,
and the alternatives (if any) to the present system of employee repre-
sentation (but see Heckscher 1988; Hirsch 1991; Voos and Mishel1991;
Weiler 1990). Fourth, American IR scholars tend to neglect work pub-
lished overseas, especially in Great Britian. Finally, one has to wonder
about the long-term prospects for IR research (narrowly defined) if the
decline of the union sector continues through the 1990s. The burst of
influential research in the 1980s most likely reflected, in part, a short-

I5I
 Industrial Relations in Decline

term phenomenon as scholars rushed to understand both the causes and

the consequences of the dramatic decline in the fortunes of organized la-
bor. The dramatic growth of theIR system in the 1930s and 1940s stimu-
lated a similar burst of research. Once this vein of research is mined, and
assuming the union sector continues to shrink in size and influence, it is
reasonable to assume that academic researchers will abandon traditional
IR topics and journals for other, more fertile fields of inquiry.

IRRA
The events of the 1980s significantly eroded the organizational vitality
of the Industrial Relations Research Association. Many of the underlying
causes originated in earlier years, as discussed in the previous chapter,
but their effect was intensified in the adverse climate of the 1980s.
On the surface, the health of the IRRA appeared relatively good.
The most explicit statement of this viewpoint is in the final report of
the IRRA's Comprehensive Review Committee (IRRA 1988a). The
committee was appointed in 1986 by the association's executive board
to take stock of and make recommendations concerning the organiza-
tion's structure, membership, finances, programs, and publishing activ-
ities. 18 The committee was codirected by Clark Kerr and John Dunlop,
two of the early presidents of the organization. The final report states
(pp. 2-3):
In at least four fundamental respects, the IRRA has proved to be a
viable and effective association: First, its membership has grown steadily
throughout the years .... Second, its finances are in sound and satis-
factory condition.... Third, IRRA has benefited greatly from a lean
and professionally sophisticated administration .... Fourth, IRRA has
indeed attracted into its membership (a) academics from a variety of
disciplines, and also (b) practitioners from the ranks of the unions,
management, government at all levels, and neutrals .... These findings
and developments lend support to the view that the IRRA's founding
objectives remain valid and that an Association designed to implement
these objectives retains relevance and vitality.
A critical review of the four areas mentioned above, as well as of
other indicators of organizational health, suggest a far less sanguine
assessment. Consider IRRA membership, for example.
As the report claimed, IRRA membership has grown steadily since
the organization's founding. Membership in the national IRRA increased

152
 Industrial Relations in Decline

from almost 1,000 in 1948 to 4, 780 in 1990 and, significantly, this

upward trend continued, albeit quite modestly, through the 1980s (from
4,589 in 1979 to 4, 780 in 1990, or about a 4 percent increase). Mem~
bership growth at the local chapter level was substantially greater, from
6,619 in 1979 to 8,900 in 1990 (a 34 percent increase) (see IRRA
1990:405).
The report largely omits discussion of three other less favorable de~
velopments. The first is that although national membership increased
in the 1980s, membership among academics declined (from 1,590 to
1,499, or 6 percent). The drop~off occurred in all disciplines (except
the "other" category). Second, as academic membership in the IRRA
was falling, the number of academic members of the Academy of Man~
agement, the IRRA's major academic rival, was expanding rapidly. The
number of persons belonging to the organizational behavior and per~
sonnel and human resource management sections of the Academy grew
42 percent during the 1980s, from 3,580 to 5,078. Third, the growth
area for IRRA membership was among nonacademics, but even here
the IRRA lagged behind other professional organizations that catered
to IR and HR practitioners. Membership in the Society for Human
Resource Management (SHRM, formerly the American Society for Per~
sonnel Administration), for example, grew from 27,501 in 1980 to
44,299 in 1990, a 61 percent increase. Among nonacademics in the
IRRA, the two occupational groups that registered the largest increase
in membership in the 1980s were unionists and arbitrators, two of the
occupations in the economy that are least likely to grow in the future.
The second and third indicators of the organization's vitality listed
in the report are its "sound finances" and "lean and professionally so~
phisticated administration." Certainly, sound finances are a prerequisite
for a viable and effective organization, and a high~quality professional
staff is a big plus, but do these indicators really tell us whether the IRRA
is a robust organization or one headed for stagnation? The link is quite
weak, I think, and suggests a certain groping for good news.
Finally, the fourth indicator listed is the association's ability to attract
academics from a variety of disciplines and practitioners from manage~
ment, unions, and government. The IRRA does draw academic members
from a wide variety of disciplines, including most of those with relevance
to the employment relationship. What the report does not say, however,
is that the proportion of members from the behavioral sciences (the

153
 Industrial Relations in Decline

growth area in employment relations) is small and probably decreasing.

In 1990, for example, only about 15 percent of the academics affiliated
with the organization listed their major specialty as human resources,
organizational behavior, sociology, or psychology.
The IRRA changed the occupational classification system in the mid-
1980s, which prevents a reliable comparison of membership growth rates
over the 1980s for individual behavioral science disciplines except or,
ganizational behavior. In the case of OB, membership registered a net
decline between 1979 and 1990. Further, membership in sociology,
psychology, and political science apparently became so small that in
1987 these categories were lumped under the "other" designation.
The IRRA does have a diverse and fairly well,balanced membership
among nonacademics. In 1990, the following groups were represented
at the national level: business (18 percent), union (10 percent), gov,
emment (9 percent), and arbitration, legal, and consulting (22 percent).
The only question I would raise is what proportion of the management
members come from nonunion companies. Data are unavailable, but I
conjecture that the proportion is small. If this is so, the IRRA has once
again allied itself with a segment of the employment relations community
that has a dim prospect for future growth.
For the reasons cited above, I do not think that the data support the
claim of the IRRA Comprehensive Review Committee that the asso,
dation has retained its vitality and effectiveness. Rather, the data sup,
port the opposite conclusion; namely, that the IRRA has experienced
a significant hollowing,out of membership and participation. A look
beyond the four criteria listed above strengthens this conclusion.
The most disturbing sign of organizational decline is the substantial
diminution in the number of nationally prominent scholars who are
active members of the group. While national prominence is admittedly
difficult to measure, there is some evidence to back up this claim.
Specifically, many labor economists consider the labor studies group of
the National Bureau of Economic Research (NBER) to be the leading
forum for economics research on labor unions and collective bargaining.
Only 28 percent of the members belong to the IRRA. Another piece
of evidence pertains to the percentage of IRRA members who are re,
searchers in human resource management. Only nine of the thirty people
(30 percent) on the editorial board of Human Resource Management
Review are IRRA members.

154
 Industrial Relations in Decline

The underrepresentation of intellectual talent in the IRRA reflects

both developments in the broader field of industrial relations and or~
ganizational problems specific to the association. The first such problem
is that most academics do not regard the association's publications as
comparable in intellectual and analytical quality to leading academic
journals or the proceedings of other professional associations. 19 The
second problem is that the IRRA's winter meetings (the more research~
oriented of the two annual meetings) are held at the same time and
place as the meetings of the American Economic Association, an ar~
rangement management and behavioral science scholars do not find
attractive. The third problem is that the IRRA's meeting arrangements
have discouraged participation by academics who are not already part
of the organization or who lack connections with active members. The
principal barrier is the small number of competitive paper sessions and
the large number ofby~invitation sessions at both of the annual meetings,
an arrangement that fosters the operation of a strong "old~boys' net~
work. " 20 The fourth problem is the association's close intellectual and
ideological ties to trade unionism and collective bargaining. On a re~
search level, the decline of the trade union movement has reduced the
number of scholars interested in labor~management relations, yet it
remains the central focal point for IRRA program sessions and publi~
cations, while others object to the pro~ union value system that permeates
the organization. 21 The fifth and final problem is that the political process
in the IRRA has tended to concentrate effective control of the orga~
nization among ILE~oriented labor economists and their allies, as re~
vealed by who has been selected to serve as the organization's president
over the last two decades. 22 This narrow political base, and the feelings
of disenfranchisement that it fosters, has likewise discouraged partici~
pation by faculty from other disciplinary and ideological perspectives. 23

155
 8
INDUSTRIAL RELATIONS IN THE
1990s AND BEYOND

T HE EVIDENCE INDICATES that industrial relations suffered a sig-

nificant decline in intellectual and organizational vitality in the
1980s. Assuming this assessment is correct, the question then
is whether the decline was a cyclical phenomenon, and thus to be
followed by a revival of the field, or whether it was part of a long-term
trend that will lead to the field's marginalization if not its eventual
disappearance.
After analyzing alternative scenarios, I conclude that the experience
of the 1980s is a harbinger of continued decline for the ILE version
of industrial relations that now defines the field. If this bleak forecast
is correct, the major challenge facing IR scholars is the development
and implementation of a strategy for change that will ensure that
industrial relations as a field, if not its name, not only survives but
prospers in the years ahead. This chapter endeavors to provide such
a strategy.

ALTERNATIVE ScENARios oF THE FuTuRE

Predicting the future of academic IR, like the stock market, 1s m-
herently risky because of the significant influence played by external
economic and political events that are largely impossible to anticipate.
One must also be leery of making linear extrapolations based on the
recent past, for the history of the field has unfolded in a decidedly
nonlinear manner. Considering the remarkable number of parallels be-
tween the economic and political events of the 1920s and those of the
1980s, one should be doubly cautious in making predictions about the

157
 Industrial Relations in the 1990s & Beyond

1990s in light of the tremendous upheaval in employment relations that

occurred in the 1930s (Dubofsky 1985). 1

IR AS A FIELD OF STUDY
The future of industrial relations as a field of study depends crucially
on how the intellectual boundaries of the field are defined and on what
the field is called. Two definitions of the field co,exist today. The first
is a broad, all,inclusive definition that equates the field with the study
of all aspects of the employment relationship. According to this defi,
nition, the intellectual domain of industrial relations includes both the
ILE and the PM schools and their principal subfields of study, labor
economics, labor history, labor law, organizational behavior and human
resource management, industrial and organizational psychology, and
industrial sociology. This is the original pre, 1960s definition of industrial
relations.
The second definition is more recent in origin and more narrow in
scope. According to this definition, the field is divided into two wings,
HR and IR, where HR is the modern,day equivalent of the PM school
and IR is the modern,day equivalent of the ILE school. Industrial re,
lations is thus defined as one particular approach to the study of labor
problems and employer,employee relations. This approach is based on
certain assumptions and values (e.g., the irreducible level of adversar,
ialism in the employment relationship; labor's inequality of bargaining
power; the necessity of independent employee representation; the im,
portance of accommodating rather than eliminating conflict; and the
efficacy of economic, social, and political pluralism) and on the value
of certain methods or policies for resolving or ameliorating labor prob,
lems, such as collective bargaining, protective labor legislation, social
insurance programs, macroeconomic full,employment policies, and
tripartite (management, union, government) policy formulation and
problem,solving at the national level. In practice, this definition tends
to equate the field with the study of trade unionism and collective
bargaining, although the intellectual boundaries are actually wider.
The label attached to the field will also influence its future. One
approach is to define the field generically in terms of its subject matter,
while the other is to define it in terms of a particular label. Thus, from
the perspective of the second approach, the field is "industrial relations"
only as long as the IR label is attached to it and loss of the label is

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tantamount to demise of the field. From the perspective of the first

approach, industrial relations can be called employment relations, hu-
man resources and labor relations, or any other name and it will still
be industrial relations in content and spirit as long as the basic intel-
lectual approach to the subject does not fundamentally change.
The future of the field depends crucially on which combination of
perspectives is adopted. For example, if industrial relations is broadly
defined to include all aspects of the employment relationship and a
generic title is acceptable, then the future of the field is bright. The
outcomes of the employment relationship, and the organizations and
administrative practices that condition them, are arguably among the
most important topics studied in all of the social sciences. Rates of pay,
conditions of work, levels of productivity, the amount of conflict be-
tween workers and managers, and the degree of job satisfaction among
employees are at the nexus of two fundamental social concerns: the
performance of the economic system and the remuneration and well-
being of the work force. These concerns can only increase in importance
as a higher proportion of the population works at a paying job; com-
petitive pressures on the American economy from overseas rivals inten-
sify further; and the nation attempts to overcome the productivity
slowdown and stagnation in real incomes of the last two decades. Add
to these trends the growing movement in the United States to view
employees and the organization and administration of work as strategic
sources of competitive advantage and the outlook for industrial relations
has to be judged as quite promising. This would presumably be reflected
in strong growth in new IR academic programs and student enrollments,
in the emergence of industrial relations as a major area of study in
business school curricula on a par with marketing and finance, and in
a major increase in the membership of the various IR-related professional
associations.
A different conceptualization of the field leads to a diametrically
opposite conclusion, however. For example, if the field is narrowly
defined as the study of unions and collective bargaining and is labeled
industrial relations, then the future is relatively gloomy. The best prog-
nosis is that the unionized sector of the economy will continue to shrink
in size and importance until it represents less than 10 percent of the
work force (Freeman 1988). An academic field built on the study of
unions will perforce have to shrink in tandem. For example, with the

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decline of the union sector and job opportunities therein, and the neg,
ative stigma carried by the IR label because of its association with
unionism, students will increasingly shun IR,labeled programs and
union,related courses, forcing first the weaker programs and then the
stronger ones to transform themselves into HR units. As the number
of IR courses and IR units shrink, so too will the number of graduates
of doctoral programs who are trained in industrial relations, leading to
a gradual withering of academic talent in the field and a concomitant
decline in IR research, journals, and professional associations. As long
as there are labor unions, there will be a field of industrial relations,
but it will become a niche field with a presence at only a few universities.
Somewhere between these two extremes lies the actual future of in,
dustrial relations. My guess is that, absent significant changes, the latter
scenario more closely represents the future than does the former. The
reasons are several.
First, industrial relations sacrificed its claim to intellectual sovereignty
over the employment relationship some thirty years ago and too much
has happened for the field to reassert its rights of ownership. The field
does not have the intellectual manpower, integrative theory, or flexi,
bility in its values to accomplish the task. For better or worse, therefore,
industrial relations will continue to be seen as one approach to the study
of employment problems-an approach currently identified with the ILE
policy program of support for collective bargaining and various forms of
government regulation of labor markets.
Second, given the ILE orientation of industrial relations, its future
depends critically on the course of employer,employee relations and, in
particular, on the fortunes of the organized labor movement. If union
membership and political power continue to decline and no major eco,
nomic or political upheavals disrupt the employment relationship, ac,
ademic and popular interest in industrial relations will slide further.
Alternatively, if the trade union movement becomes revitalized or the
nation's labor law is changed in a way that makes it substantially easier
for unions to win new members, or a new form of employee represen,
tation (e.g., works councils) becomes widely established, or some na,
tional crisis precipitates significant conflict and unrest in the workplace,
industrial relations will be well positioned to experience a renaissance.
Although either outcome is possible, the odds favor the former.
Third, the future of industrial relations also depends on its ability to

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generate new, intellectually exciting ideas in the world of science and

for these ideas to serve as catalysts for the development of new, pro,
gressive business practices and public policies pertaining to the work,
place. 2 As currently practiced, ILE,style industrial relations falls
significantly short of this goal. A serious problem in this regard is that
academic research, in response to the culture and incentives spawned
by science,building, has become ever narrower, more obsessed with
methodology, and more detached from the world of practice and policy.
This is reflected, in tum, in the research reported in the IR journals,
most of which makes a contribution to knowledge but at the same time
is too narrowly academic and backward,looking to serve as a significant
source of the "new thinking" that the field requires.
Another problem militating against such "new thinking" is the strong
intellectual and philosophical commitment of many scholars to the New
Deal industrial relations system and their corresponding fear that a
critical examination of this system and/or advocacy of some alternative
will place them in a position that is perceived as anti, union. 3 This
commitment to past practices and policies may well result in industrial
relations playing a largely reactive role in what will surely be two of the
major IR policy issues of the 1990s-the overhaul of the Wagner Act
and the search for new and improved models of workplace governance
and employee representation.
Finally, there is a part of industrial relations that clearly faces a bleak
future. That is the name of the field. The term industrial relations is
perceived by most people as associated with unionism and collective
bargaining and with a blue,collar, factory economy. This liability most
affects academic programs since they must actively compete for students
who increasingly regard an industrial relations-labeled degree as a hand,
icap in the job market. The label is also a liability, though to a lesser
degree, as a title for an area of academic research, and the journals and
professional associations therein, since in this arena industrial relations
stands for a set of ideas rather than a credential in the job market. Some
scholars have attempted to preserve the term's lease on life by arguing
that industrial applies to the study of all employment relationships, not
just those in manufacturing and/or in unionized firms. 4 I predict that
this effort will be unsuccessful, however, and that the term industrial
relations will gradually fade (not always quietly) from the academic scene,
particularly as a label for academic programs.

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 Industrial Relations in the 1990s & Beyond

IR INSTITUTES AND ACADEMIC PROGRAMS

The future of IR institutes and academic programs will closely mirror
that of IR as a field of study. Several events can be anticipated. First,
no new IR,labeled academic programs will be established in the United
States. Second, several existing IR,labeled programs will abandon the
IR label altogether or will modify it significantly by including an HR,
related term. This process will initially affect smaller, less prominent
IR programs and those in lightly unionized states, but eventually it will
also affect most, if not all, of the programs in the top tier. Third, nearly
all IR programs will reduce the ILE focus of their programs by means of
freezes or outright cuts in faculty positions and courses devoted to trade
union and collective bargaining subjects and/or by hiring new faculty
and creating courses in the HR area. Fourth, some free,standing IR units
will be merged into business schools, resulting in a significant dilution
of their interdisciplinary and ILE orientation, while others will be abol,
ished altogether. The units most susceptible to outright elimination are
those with the strongest collective bargaining and labor studies orien,
tation and those that exist primarily to sponsor research (closing them
provides a relatively easy way for universities to save overhead costs and
generally does not threaten faculty positions and academic programs,
and faculty today are much less interested in interdisciplinary research).
On the other hand, the next decade may well be a boom period for HR
academic programs. Fueled by the tremendous increase in business school
enrollments, the transformation of HR from a tactical area of business
practice to a strategic one, and the growth in the complexity and cost
of human resource activities and programs in business firms, personnel
and human resource management, once academic backwaters, have
become newly emergent areas of growth. We can thus expect universities
to expand significantly their courses, faculty, and academic programs in
the HR area. These programs will be substantially different from those
established in the immediate post-World War II period, however. For
example, nearly all new HR programs will be in business schools. Fur,
ther, universities will generally forgo a formerly constituted institute or
center with faculty positions attached to it in favor of other approaches.
The least ambitious will be to create a separate concentration or major
in personnel and HRM in the undergraduate or graduate business cur,
riculum, wherein the staffing of the courses and the administration of
the major will generally be the responsibility of the management faculty.

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 Industrial Relations in the 1990s & Beyond

The more ambitious will be to create a separate, multidisciplinary HR

degree program within the business school, typically at the graduate
level, with a coordinator and jointly appointed faculty.
The curricula of the new programs will be heavily oriented toward
business subjects, will emphasize the management perspective in em-
ployment relations, and will draw most of their intellectual and research
content from the behavioral sciences. The students and faculty in them
will not identify their field of study as "industrial relations" but, rather,
will think of it in terms of some HR-related title. If the term industrial
relations is used at all, it will be to connote the labor-management
relations part of the curriculum.

RESEARCH
The pattern of research in industrial relations in the 1990s, and the
associated strengths and weaknesses, will closely match those of the
1980s. Since the record for IR research in the 1980s was relatively good
by my reckoning, the outlook for the 1990s is also optimistic, albeit
modestly so.
I expect to see the publication of several influential, highly regarded
IR books and articles. The current crisis affecting the New Deal industrial
relations system, and the concomitant intellectual crisis afflicting in-
dustrial relations, open up a host of important research issues that schol-
ars are just beginning to investigate. In this respect the research
performance of the 1990s is likely to resemble that of the 1950s, in that
both periods followed a dramatic sea change in the level of union density.
Among the most important topics demanding attention are national
labor policy, particularly the continued appropriateness of the Wagner
Act; new forms of employee representation, such as works councils and
associational unionism; international dimensions of unionism, such as
divergent growth rates, organizational and legal structures, and economic
effects; innovations in union practices and contracts as unions attempt
to broaden their appeal to the unorganized and deal with the competitive
problems of unionized employers; and the impact of IR practices in the
workplace on economic competitiveness.
In addition to collective bargaining-related topics, fertile areas for
research exist on the causes of and solutions to the many serious eco·
nomic problems facing the American work force, including the height-
ened insecurity of employment, the stagnation in real income, the

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growing racial divisiveness, and the shortfalls in education and training.

IR researchers also need to subject to critical analysis the intellectual
premises and workplace performance of the HR-inspired models of work
organization and management.
Another development that bodes well for IR research is the increasing
number of scholars who are marrying modem statistical techniques with
the case study "go and see" approach pioneered by the early institu-
tionalists. Part of the reason for the sterility of IR research in the 1970s
and early 1980s was that it resulted from a combination of obsessiveness
with methodology and use of secondary data sources. The net result was
that the research was remote, esoteric, and of little relevance to policy.
makers or practitioners. Fortunately, a growing number of IR scholars
are getting out in the field and conducting investigative case studies of
employee involvement programs, dispute resolution procedures, and
NLRB representation election campaigns and, at the same time, are
grounding the research in as much of a theoretical framework as is
available and applying multivariate techniques to analysis of the data.
The result is research that combines the strengths of both the traditional
case study approach and the modem analytic approach. I expect (and
hope) that this trend will continue.
I also detect a modest increase in the amount of multidisciplinary
research being conducted. For example, greater efforts have been made
in recent years to bring to the analysis of unions and collective bargaining
various concepts and ideas from the management and behavioral science
literature. This is evident in the discussion of management strategy and
industrial relations (Kochan, Katz, and McKersie 1986; Lewin 1987)
and in the application of psychological and sociological concepts to
models of strikes (Wheeler 1985), union joining (Fiorito 1987), and
union participation (Gallagher and Strauss 1991). In addition, there
appears to be a recent boomlet in interest in the study of comparative
and international industrial relations, a vein of research that promises
to bring a greater number of political scientists, sociologists, and his-
torians into contact with mainstream IR.
Set against these positive developments are several negatives. Indus-
trial relations research will continue to focus disproportionately on union
and labor-management issues. If the organized sector of the economy
continues to shrink in size, the long-term prospects for the vitality of
IR research are slim. And, although a somewhat greater amount of

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multidisciplinary research will be produced in the 1990s, the amount of

interdisciplinary research is likely to remain minuscule because of the
trend toward research specialization and the desire of researchers to avoid
being caught in a crossfire of criticism from journal referees of different
disciplinary backgrounds. Finally, I believe IR as a field would benefit
if greater emphasis were placed on applied, problem-solving research.
Such research has greater relevance to practitioners and policy makers
and stimulates a more holistic, interdisciplinary perspective. I suspect,
however, that the bulk of IR scholars (particularly younger scholars
subject to the pressures of promotion and tenure) will continue to em-
phasize academic issues of theory and research methodology.
IRRA
One source of the IRRA's problems is that its academic membership
base has become increasingly narrow and hollowed out. Although the
organization is nominally committed to representing all disciplines and
ideological factors interested in employer-employee relations, in practice
it has become the de facto intellectual home for advocates of the ILE
wing of industrial relations and the major academic interest group rep-
resenting trade unions and their economic and political allies (e.g.,
arbitrators). Over time, the organization's alliance with these two con-
stituencies has resulted in a significant reduction in the number of ac-
ademics who wish to participate in the organization, for those who are
most welcome and who will be nominated for high office are increasingly
rare birds-scholars who not only are interested in labor-management
relations but also can pass the organization's ideological litmus test (i.e.,
they have a philosophical belief in the desirability of pluralism in general
and unions and collective bargaining in particular). Given that even
fewer academics will possess these attributes in the future, I expect that
the academic membership of the IRRA will continue to decline in the
1990s.
The IRRA's troubles go beyond a decline in the number of dues-
paying academic members, however. A significant problem, for example,
is that the organization faces the prospect of losing to retirement the
postwar neoinstitutional economists who in effect have run the orga-
nization for the last several decades. Given the declining appeal of the
IRRA to younger scholars, there will be a dearth of "rising stars" waiting
in the wings to take over leadership positions. 5

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 Industrial Relations in the 1990s & Beyond

Likewise, the IRRA no longer attracts to its meetings many of the

most talented researchers in the field, and, indeed, an increasing number
of these people are not even members of the organization. One of the
problems is the ideological litmus test, but another is that the organi~
zation's published proceedings and monographs are viewed as relatively
"lightweight" and thus unattractive to scholars who are trying to gain
tenure or a big name in the field. I see this trend intensifying, absent
a major effort to increase the rigor of at least some of the association's
publications.
The IRRA has also traditionally neglected behavioral science, non~
union, management~oriented research, yet it is this segment of the field
that is growing the most rapidly. The ability of the organization to
accommo4ate to this shift is limited, however, by both intellectual and
political constraints. The theoretical and conceptual core of present~
day industrial relations is largely incompatible with that used by most
HR researchers. Giving greater organizational access to HR researchers
may therefore result in an equal or larger defection of traditional IR
researchers. As noted in the last chapter, the IRRA's ability to shift its
research focus significantly is also limited by internal political factors.
In particular, for both philosophical and economic reasons, a sizable
faction of the IRRA membership would probably strongly resist any
attempt to refocus the organization's research thrust toward the nonu~
nion sector and/or the practice of management. 6
Another potential problem is the possibility that at some point in
the future the University Council of Industrial Relations and Human
Resource Programs (UCIRHRP, the former IR center directors' group)
may reschedule the date of its annual meeting to coincide with the
meetings of some other professional association such as the Academy of
Management (or rotate the meeting between the IRRA and this other
group). To date, most of the directors of the various IR institutes and
centers have come from the ILE wing of the field and have thus had a
natural affinity for the IRRA. As the behavioral science, HR side of
the field grows, however, it is likely that the HR faculty will outnumber
the IR faculty in the institutes and centers. We can expect, then, a
greater push to abandon the IR label for the academic programs, a greater
likelihood that future generations of institute directors will be behavioral
scientists with research interests in OB and HRM, and a concomitant
push to have the center directors' meeting at a different time and place

166
 Industrial Relations in the 1990s & Beyond

than the IRRA meetings (e.g., at the meetings of the Academy of

Management). Since the center directors' meeting brings to the annual
winter IRRA meetings some of the key players in the field, the loss of
this group would deal the IRRA a serious blow.
Finally, the IRRA is hampered by a growing gap and lack of inter-
action between the academic and practitioner wings of the organization.
One of the fundamental goals of the founders of the IRRA was to
promote the interchange of ideas and perspectives between academics
and practitioners, so as to enrich both the study and practice of industrial
relations. Over time, however, the two sides have grown apart until
they inhabit largely separate worlds. The domain of the academics is
the winter meetings of the IRRA, an event that mainly attracts professors
and graduate students. The domain of the practitioners is the local IRRA
chapter meetings, which are sparsely attended by academics and to which
they contribute little.

A STRATEGY FOR SuRVIVAL AND GRoWTH

If the assessment offered above is anywhere close to correct, the field
and its major institutions are in trouble. What can be done to tum
around the situation? The next section provides one strategy for change. 7

IR AS A FIELD OF STUDY
The first requirement for a resuscitation of industrial relations is a
name change. Although the term industrial relations has a long and
honored history, in recent years it has acquired an overly narrow and
out-of-date meaning that is an increasing handicap for the field. The
most attractive replacement is employment relations. The virtues of this
term are that it continues to emphasize the field's emphasis on relations
between employers and employees but at the same time broadens the
focus of the field from the industrial sector of the economy to the totality
of employment relationships. 8
The second requirement is to broaden and reposition the boundaries
of the field and redefine its core subject matter. The intellectual domain
of present-day IR is largely the product of the historical development
of science-building and problem-solving in the ILE wing of the field. A
broadening and repositioning of the field requires, therefore, a funda-
mental reexamination of the subject matter included within both sci-
ence-building and problem-solving. It is the combination of topics and

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 Industrial Relations in the 1990s & Beyond

concepts subsumed within these two perspectives that represents the

essence of what I propose as the "new IR."
From a science-building perspective, a field of study such as industrial
relations needs to be organized around a specific phenomenon or form
of behavior so that theory construction and the deduction of hypotheses
can take place. The phenomenon focused on in the pre-1960s version
of industrial relations was the employment relationship, as indicated by
the definition of IR then widely in use-"the study of all aspects of the
employment relationship." The problem with this conceptualization of
the field was that it subsumed such a disparate range of activities and
behaviors that theory construction and hypothesis-testing became quite
difficult. As described in chapter 6, industrial relations largely abandoned
the employment relationship as an organizing concept for research after
1960 and narrowed its attention to trade unions and collective bar-
gaining. While these topics afford much greater opportunities for theory
construction and hypothesis-testing (and thus the creation of a com-
munity of interests among research scholars), the drawback is that the
phenomena chosen for investigation are now found among only a small
minority of U.S. employers.
I propose an intermediate position. The focus of IR research should
be squarely centered on the employment relationship and, most partic-
ularly, on the outcomes of the employment relationship that affect
efficiency, equity, and individual growth and well-being. The place to
start the study of industrial relations is thus at the organization level,
for it is within the organization (shop, plant, firm, and so on) that
outcomes such as rates of pay, decisions to join a union, productivity
growth, strikes, and promotion opportunities are determined. Consid-
eration of these topics is not the sole province of industrial relations,
however, but is divided between it and the field of human resources.
The division runs along what I perceive to be a fundamental intellectual
fault line in research on the employment relationship. This fault line
has the "intemalists" of the HR wing on one side and the "extemalists"
of theIR wing on the other. 9
The intemalists seek explanations for employment outcomes in factors
internal to the organization, such as the nature of management practices,
the structure of the organization, the psychological determinants of
worker and manager behaviors, and the tenor of social relations between
managers and workers. Scholars in this camp come primarily from

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 Industrial Relations in the 1990s & Beyond

management-related fields, such as organizational behavior and human

resource management and the behavioral science disciplines of anthro-
pology, psychology, and the micro side of sociology.
In contrast, the externalists seek explanations for employment out-
comes in factors external to the organization, such as economic con-
ditions in product and labor markets; sociological characteristics
pertaining to the demographic, occupational, class, and urban versus
rural structure of the local community or nation; the legal structure
surrounding the conduct of employer-employee relations; and prevailing
cultural, political, and social norms in the society. Scholars in this group
come primarily from economics, law, political science, history, and the
macro side of sociology. 10
This conceptual dichotomy has several virtues. First, it highlights the
common intellectual roots of both HR and IR in the study of the em-
ployment relationship, thus facilitating greater interaction and dialogue
between the two. Currently many scholars regard HR and IR as separate
subjects, the former dealing with human resource management issues
and the latter with labor relations. The perspective advocated here
suggests instead that they are concerned with the same broad subject
but represent different approaches and points of view. 11
Second, IR is broadened and repositioned so that it covers a wider
set of subjects and appeals to a wider audience of scholars. As framed
above, IR is transformed from the study of unions and collective bar-
gaining to the study of all the practices, behaviors, and institutions
relevant to the employment relationship. Thus, not only the traditional
union and labor economics topics fall within the domain of IR research
(or what might be thought of as dependent variables) but also subjects
often considered outside the purview of the field, such as the determi-
nants of employee work effort, methods of employee recruitment and
selection, and the structure of business organizations. 12
Third, although IR research spans the gamut of subjects related to
the employment relationship, because of the concentration on the ex-
ternal environment to the organization, and how this environment
affects the structure of the organization, its human resource policies and
practices, and the behaviors of its workers and managers, the field has
an intellectual foundation that can be used as the basis for the devel-
opment of conceptual models around which scholars from disciplines as
diverse as economics, law, and sociology can build a community of

169
 Industrial Relations in the 1990s & Beyond

interest. Dunlop's industrial relations systems model (1958) provides

one example; the strategic choice model developed by Kochan, Katz,
and McKersie (1986) provides another. 13 What makes the external en,
vironment a viable organizing device for the field is that it brings together
disciplines with enough complementarity in their theoretical and meth,
odological approaches to research that scholars will find associating with
one another to be an intellectually rewarding experience. These com,
plementarities include a mutual concern with conditions affecting the
employment relationship that arise outside of the firm, are the result of
aggregative forms of behavior (e.g., the operation of markets, social
groups, and political institutions), and are more easily measured for use
in large,scale cross,section and time,series empirical studies. Because of
these commonalities, researchers from these disciplines are more likely
to have an interest in many of the same independent variables and
research designs, an interest not likely to be shared to the same degree
by HR researchers. 14 The externally oriented disciplines are also united
by their far greater concern with and relevance to issues of national
employment policy.
Science,building defines one of the "faces" of industrial relations as
a field of study; problem,solving defines the other. Here too repositioning
is required.
The focus of current,day industrial relations on unions and collective
bargaining reflects not only intellectual considerations but also the com,
mitment of the ILE wing to a set of assumptions and values concerning
the employment relationship. From a problem,solving point of view,
whether this preoccupation with unions and collective bargaining is
desirable depends on whether they (and the rest of the ILE policy
program) remain the most effective method to promote the goals of
industrial relations-increased efficiency, equity, and personal growth
and well,being. Clearly, there is a range of opinion on this matter.
Social and economic conservatives (e.g., Heldman, Bennett, and John,
son 1981; Reynolds 1984), for example, typically advocate less govern,
ment intervention in labor markets, and in particular a reduction in
legal protections and encouragement of the right to organize and bargain
collectively, while persons on the opposite end of the philosophical
spectrum maintain that the nation's well,being would be promoted by
further unionization and a strengthening of the protective net of labor
legislation (Freeman and Medoff 1984; Weiler 1990). Where should

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 Industrial Relations in the 1990s & Beyond

industrial relations position itself? I believe the field is again best served
by an intermediate position.
My reading of the evidence is that economic and social conditions
both inside and outside the workplace have evolved in the post-World
War II period in ways that have seriously undercut the net contribution
of the New Deal industrial relations system to the achievement of the
three aforementioned goals. Unlike some of the critics, I do not believe
that this evolution has made the current IR system obsolete or that it
should be dismantled in favor of a deregulated, union-free environment.
The system does need a substantial overhaul, however. The case becomes
obvious when one examines the reasons advanced for the establishment
of the current system.
As described in chapter 2, the ILE view of the employment relation-
ship provided a number of rationales for the enactment of the Wagner
Act and other pieces of protective labor legislation in the 1930s. One
major pillar was the assumption that restrictions on labor mobility,
collusive practices by employers, and the frequent existence of substan-
tial involuntary unemployment tilt the plane of competition against
individual workers in a nonunion situation, leading to substandard
wages, working conditions, and treatment by management. Another
fundamental pillar of ILE support for trade unions and collective bar-
gaining was that they replace the autocratic master-servant relationship
in the workplace with a system of industrial democracy, thereby ensuring
due process and opportunities for employee involvement in both the
management of the enterprise and the determination of wages and work-
ing conditions.
Do these rationales make sense in the economic and social context
of the 1990s? The answer, I think, is a qualified yes; yes because at the
most elemental level the major ILE premises retain validity but with a
strong note of qualification because they require significant modification
and adaptation if they are to be relevant in today's economy and
workplace.
A prime example concerns one of the principal justifications for the
Wagner Act-labor's inequality of bargaining power. A good case can
be made that the labor market was not a level playing field for many
workers in the 1930s and that the development of industrial unions and
companywide and industrywide collective bargaining helped restore bal-
ance into the wage determination process (see Kaufman 1989a, 1991a).

171
 Industrial Relations in the I 990s & Beyond

Over the last half-century, however, most of the causes of labor's dis-
advantageous position have been significantly reduced through full-
employment macroeconomic policies, labor's increased geographical mo-
bility, antidiscrimination legislation, and so on. Thus, in the 1930s,
union bargaining power could justifiably be regarded as a countervailing
force that tended to offset the market power of employers. In the 1990s,
however, fewer workers suffer from a disadvantage in bargaining power
and the extent of this disadvantage is likewise smaller. As a result, the
playing field is more level, thereby reducing the demand for collective
bargaining by unorganized workers and making it far more likely that
once a union is recognized its exercise of bargaining power will lead
over time to monopolistic wage premiums and attendant forms of re-
source misallocation. The implication, then, is that a set of public
policies that made sense in the 1930s may no longer be appropriate.
Similar considerations apply to the voice function of unions. One of
the strongest arguments for unions is that, by providing workers with
an independent form of representation (or voice), they not only ensure
greater workplace equity through the bargaining and grievance processes
but also lead to increased efficiency by leading to lower turnover rates,
higher productivity, and so on. Even granting the correctness of these
assertions (a strongly debated issue, particularly with regard to the latter
point), one must still wonder whether traditional collective bargaining
as practiced under the Wagner Act is as successful in achieving these
ends as it was several decades earlier. Evidence indicates, for example,
that unionized workers continue to value formalized grievance systems
but that the effectiveness of these systems is coming under increasing
scrutiny because of their high cost, significant time delays in resolving
disputes, and the residue of adversarialism left after a settlement is
reached (Dalton and T odor 1981).
Likewise, while research studies from forty years ago found that the
process of union voice had a positive impact on productivity and cor-
porate personnel practices (e.g., Stichter, Healy, and Livemash 1960),
the evidence from today is more mixed (Freeman and Medoff 1984;
Hirsch 1991). A particularly salient issue in judging the continued ef-
ficacy of collective bargaining is whether the adversarial principle on
which the system is built is still compatible with the attainment of
world-class standards in product quality and productivity. 15 The newest
generation of best-practice plants, for example, rely heavily on trust-

172
 Industrial Relations in the 1990s & Beyond

building, employee involvement, and flexible work rules, attributes that

seem to be considerably more difficult to initiate and maintain success~
fully in unionized situations (Kochan, Katz, and McKersie 1986).
While the evidence is suggestive at best, it nevertheless is indicative
of a trend; namely, that the ILE policy program-and its cornerstone,
trade unions and collective bargaining-has lost a considerable degree
of effectiveness as a solution to the employment problems of both workers
and employers. If I am correct in my assessment, industrial relations as
a field needs to become far more active in its efforts to develop new
laws, institutions, and practices that can do a better job at solving these
problems, whether through a modification of the existing New Deal IR
system or the development of a new (possibly imported) system. In any
case, these new laws, institutions, and practices will come to define the
second "face" of industrial relations as a field of study. What will this
face look like? The answer will not be known until IR scholars undertake
a reevaluation and reformulation of the basic assumptions that underlie
the field and devise the institutional solutions to the problems at hand-
a process that has already been initiated (see Kochan, Katz, and
McKersie 1986; Weiler 1990; Katz 1991) but that has made only modest
progress. My guess is that at the end of this reevaluation process the
problem~solving face of IR will be dominated by several issues.
The first defining feature of this face of industrial relations (or em~
ployment relations) will be the continued emphasis on the term relations,
as opposed to the HR side, where the term management will be at center
stage. The emphasis on the term relations communicates two messages
about the field that will not change: first, that labor is embodied in a
human being whose interests and concerns as both a person and factor
of production must be given equal weight with those of management
and consumers and, second, that the inherent conflict of interest em~
bodied in the employment relationship is of sufficient importance to
warrant there being a separate field of study devoted to the consideration
of these relations.
The second notable feature of the problem~solving face of industrial
relations in the years ahead will be its association with systems of work~
place governance. Trade unions and collective bargaining will remain
an important subject in industrial relations, but they will no longer
define it. Rather, collective bargaining will increasingly be seen as only
one of many systems of control, rule~making, and employee represen~

173
 Industrial Relations in the 1990s & Beyond

tation, or what are generically referred to as systems of workplace gov-

ernance. The impetus behind consideration of other forms of gover-
nance is the search for some institutional means that provides effective
justice and voice in the workplace and at the same time does a better
job than collective bargaining at both promoting productive effici-
ency and appealing to the currently unorganized segments of the
work force.
While the HR wing will also have an interest in workplace gover-
nance, this topic will be perceived as an intellectual pillar of industrial
relations, given the field's historic and continuing commitment to the
promotion and protection of workers' rights and equity interests. The
emphasis on workplace governance will also perpetuate IR's historic
focus on the study of workplace institutions and the role of institutions
in supplementing both the market and management as control mech-
anisms in the employment relationship.
The third feature of industrial relations will be the continued attention
given to labor-management conflict and dispute resolution. The field
was born out of public concern over the mounting scale and intensity
of strikes and labor violence in the 1910s, and the principal purpose of
early research in the field (as exemplified by the activities of the Com-
mission on Industrial Relations) was to discover the underlying causes
of this unrest and methods to promote reconciliation and compromise.
It is not coincidental that the field's high points in years since have
largely coincided with similar outbursts of labor-management conflict
and attendant concerns with dispute resolution. Given the field's con-
tinuing emphasis on the relations between employers and employees, I
would expect that labor-management conflict and the resolution of dis-
putes will remain a central part of the problem-solving agenda of in-
dustrial relations in the years ahead. Consistent with the shift from a
narrow focus on collective bargaining to a broader concern with alter-
native forms of workplace governance, however, there must be a con-
comitant broadening of the field's approach to the subject of conflict in
the workplace, including alternative forms of conflict (e. g., various forms
of individual withdrawal behavior, such as shirking and quitting), and
systems of conflict resolution (e. g., peer review).
The fourth notable feature of the problem-solving face of industrial
relations will be an increased emphasis on topics such as competitiveness,
productivity, and product quality. In the past, industrial relations largely

174
 Industrial Relations in the 1990s & Beyond

took for granted the management side of the employment relationship

and the impact of IR policies on the economic performance of the firm.
The rise of powerful international competitors such as Germany and
Japan, and the lackluster performance of the American economy in
productivity growth, will make this neglect untenable in the future.
Even a field that has workers' rights as a major focal point cannot ignore
the adverse impact that a loss of international competitiveness has on
job opportunities, employment security, rates of pay, and living stan-
dards. In addressing such concerns, IR will have to be willing to examine
current labor market institutions and practices critically to ensure that
they are part of the solution, not the problem.
In short, industrial relations will not have a unitary focus or theoretical
model, such as economics does with the operation of markets and the
model of supply and demand, but it will have a series of connected
intellectual themes defined by the field's interest in both science-building
and problem-solving. The core of the field will be at the intersection
of these two dimensions; that is, the study of the impact of external
environmental forces on the organization and performance of work and
the resulting relations between employers and employees, and the de-
velopment of a system of workplace governance that is congruent with
these external forces, promotes efficiency in the internal operation of
the enterprise, protects workers' equity interests, and contributes to the
development and growth of the nation's human resources.
I see the intellectual themes described above as being of sufficient
generality as to demarcate a distinct intellectual boundary for the field
within the social sciences. This field would be of interest to a large
group of scholars across numerous disciplines yet intellectually cohesive
enough to provide for the development of broad-based conceptual frame-
works and a well-defined community of research interests. These themes
must be sufficiently elastic that the field remains identified with reform
and progressivism with respect to policy and practice yet avoids being
wedded to any particular set of institutions or practices. I believe the
themes suggested above meet these criteria and could provide the basis
for a new, reconstituted field of industrial relations that is consistent
with much of its past yet is broadened and updated to make it more
competitive in the years to come. 16

175
 Industrial Relations in the 1990s & Beyond

IR UNITS AND ACADEMIC PROGRAMS

The next part of the strategy concerns the preservation of existing
IR units and academic programs and the creation of new ones. These
programs are essential in fostering integrative, interdisciplinary research
and teaching on the employment relationship and in providing both
ILE and PM perspectives on that relationship.
The most important step in this direction is successful marketing of
an intellectual idea; namely, that it is the employment relationship that
defines the field and is the concept around which teaching and research
in the field is organized. Once this proposition is accepted, it then follows
as a matter of course that a well,rounded program will have a multi,
disciplinary faculty and curriculum and will provide coverage of both the
employer's and the worker's side of the relationship and both the internal
(HR) and the external (IR) perspective on research. The advantage of
this construct is that it allows enough flexibility for academic programs
to vary the proportion of the faculty and curriculum devoted to HR
versus IR as suits their strategic goals and student demand conditions,
but at the same time it contains intellectual constraints that prevent
programs from adopting one extreme position or the other (all IR or all
HR). If the organization of the field is defined in terms of IR versus
HR, however, the battle will be lost, for most schools will choose a
relatively pure HR approach that will be far more one,sided in disci,
plinary coverage, topical focus, and ideological perspective.
If the employment relationship defines the program focus of IR units,
then the titles of the programs must reflect this focus. I have already
proposed using the term employment relations to replace industrial relations
as the label for the ILE (or external) wing of the field, a suggestion that
if adopted makes employment relations too restrictive to serve as a stand,
alone label for academic programs that span both IR and HR. What is
needed is an entirely new label that conveys that the intellectual territory
under consideration covers the entire employment relationship and,
most particularly, both the IR and HR wings. No such label exists that
I can identify, a situation that illustrates both the tremendously expan,
sive nature of the intellectual territory associated with the subject of
employment and the futility of past attempts to discover the conceptual
thread that binds these intellectual remnants into a single discipline.
Given this lacuna, the next best solution is for programs to use a com,

176
 Industrial Relations in the 1990s & Beyond

bination of labels in the title, such as "Human Resources and Industrial

Relations" (the new title for the IR program at Loyola University in
Chicago). 17
The survival of traditional IR units also depends on their maintaining
a strong market demand for their doctoral graduates. Changing the name
of the field and broadening it to encompass a macro-level, employment
governance perspective of the employment relationship would certainly
help make IR students, particularly those in business schools, more
marketable.
Another important step is to increase the job market value of a cross-
disciplinary degree. The route has been outlined earlier; namely, em-
phasize that high-quality teaching and research on the employment
relationship requires training in both the behavioral and nonbehavioral
sciences. This is a message that the University Council of Industrial
Relations and Human Resource Programs should vigorously promote.
Finally, IR doctoral programs may need to further scale back the
multidisciplinary nature of their programs so that students can acquire
a greater degree of specialization in business-related subjects. Several IR
units, have already done this, with the result that the social science
and liberal arts component of the curriculum has been significantly
reduced relative to what it was twenty and thirty years ago.
Universities should also be encouraged, when they create HR pro-
grams, to give them multidisciplinary faculty and curriculum and to
provide courses on both PM and ILE subjects. The UCIRHRP, for
example, should actively foster the creation of independent HR majors
and degree programs in business schools that are separate from the course
offerings and degree programs in management. The stand-alone status
of these programs would facilitate the development of a more compre-
hensive, integrated curriculum, a part of which would involve courses
not generally offered as part of a degree in management (e. g., labor
economics, employment relations theory). The UCIRHRP might also
establish an accreditation program that would have as one of its re-
quirements a multidisciplinary curriculum with some balancing of ILE
and PM perspectives. Finally, the UCIRHRP should aggressively recruit
multidisciplinary HR programs to join the association and encourage
the directors of these programs, when their programs are not housed in
some autonomous unit, to work toward the creation of such.

177
 Industrial Relations in the 1990s & Beyond

RESEARCH
IR research must also be repositioned if industrial relations is to survive
and prosper in the future. The first step is to widen the scope of the
research. The approach to be taken follows directly from the discussion
in the previous sections. Suggestions similar in spirit if not in detail
have also been made by Strauss (1990), Cappelli (1990), Cutcher-
Gershenfeld (1991), and Sherer (1991). As I conceive it, the aim of
IR research is to explain how conditions in the economic, legal, tech-
nological, social, and political environment external to unions and firms
affect the structure, practices, and policies of these organizations, and
the behavioral outcomes that emerge out of the employment relation-
ship. So conceived, industrial relations research encompasses a wide
variety of topics. Certainly among these is the traditional forte of in-
dustrial relations, trade unions and labor-management relations. Other
topics also qualify, however, even though by the conventional definition
of the field their relationship to the study of industrial relations is unclear.
Two examples illustrate the point.
A subject popularized by Kochan, Katz, and McKersie (1986), for ex-
ample, is the relationship between business strategy and corporate capital
investment decisions and human resource practices. This subject is
squarely within the domain of IR research because it focuses on a macro-
level explanation for an organization-level employment outcome-the
effect of heightened international competition on corporate business
strategy and the consequent decision to close unionized plants, open new
plants in the South, introduce self-managed work teams, and so on.
Employment systems are another example (see Osterman 1987; Begin
1990). Employment systems are alternative technical and social systems
for organizing production and the performance of work. Each employ-
ment system carries with it a particular set of human resource policies
concerning recruitment, selection, compensation, and retention. A
wide diversity of such systems and associated human resource policies
exist across firms (e.g., compare a fast-food restaurant, a bank, and an
auto-assembly plant). Why do firms choose a particular employment
system? Why are firms abandoning the traditional "control" model of
work organization for a "high-involvement" model? Industrial relations
is well positioned to answer these questions, for much of the variation
in employment systems and individual human resource practices (the

I 78
 Industrial Relations in the 1990s & Beyond

dependent variables) both in a cross~section and over time are linked

to variations in economic, technological, and demographic conditions
(the independent variables) that are external or exogenous to the firm
(Dunlop 1993).
Improving the quality or social "value~added" of IR research is the
second step of the strategy. The particular strengths of IR research are
its integrative character and its relevance to issues of practice and policy.
The integrative feature comes from the field's location at the crossroads
of several disciplines, a conjunction that has led to the development of
distinctive "middle~range" theories-theories that synthesize concepts
across disciplines at an intermediate level of generality (Kochan 1992).
The relevance of IR research springs from the field's concern with applied
problem~solving issues. The 1950s was a golden age for industrial re~
lations precisely because the research of the period was extremely rich
in both middle~level theory and practical relevance. There is no reason
IR research could not attain the same level of prestige in the 1990s,
particularly given the plethora of serious employment problems facing
the nation. But will it?
I suspect the answer is no. The IR scholars of the 1950s brought to
the research process a combination of excellent training in the theory
and research methods of their home disciplines, a receptivity to a mul~
tidisciplinary approach, and extensive practical experience gained from
personal involvement in the activities of business, unions, and govern~
ment. While only the first characteristic is essential for research success
within individual disciplines (as exemplified by articles in the Journal of
Labor Economics and Journal of Applied Psychology), all three are required
to conduct high~quality research in a multidisciplinary, problem~
oriented field such as industrial relations. Unfortunately, present~day IR
scholars (particularly younger scholars still subject to the publish or
perish pressures of tenure and promotion) all too often have excellent
theoretical and methodological skills (certainly dwarfing anything pos~
sessed by the researchers of the 1950s) but lack both practical experience
and interest in cross~disciplinary research. The result is that a significant
share of IR research, and particularly that published in research journals,
exhibits a narrowness and sterility that is the product of a unidisciplinary
focus, an obsession with methodological considerations, and an author
who has had relatively little personal contact with the subject under

179
 Industrial Relations in the 1990s & Beyond

investigation. The blame lies not with the individual researchers but
with the reward system and culture in academe that overemphasizes
science-building.
The solution is to devise mechanisms that facilitate and encourage
cross-disciplinary research, the collection of primary data, interviews
with company and union officials, and immersion in the nitty-gritty of
institutional details and daily practice. (Some researchers are already
doing it, but more are needed.) This unglamorous process must take
place if scholars are to discover the true nature of the labor problems
confronting employers and workers and develop the theories and prac-
tices needed to resolve them. Accomplishment of this goal is difficult,
however, in the current environment of science-building in American
universities. Nonetheless, several actions could make a difference.
To help broaden and strengthen the field, the mainstream IR journals
need to reposition the mix of articles accepted for publication. For
example, the number of "pure" labor economics articles accepted for
publication should be reduced, since these often have only a tangential
link to the employment relationship and offer little, if any, cross-
disciplinary perspective. Articles on economic aspects of human re-
sources management should be encouraged, however, for they are di-
rectly relevant to the field and are more likely to span disciplinary
boundaries with respect to content. Another step is to increase the
number of papers published by authors from other "external" disciplines,
such as sociology and political science. At the same time, research that
is clearly of an "internal" nature (e.g., organizational commitment stud-
ies) should be published elsewhere if IR is to develop a coherent image
vis-a-vis HR. Mainstream IR journals should also give preference to
articles that involve primary data, interviews with company and union
officials, and participant-observer techniques so as to encourage the
development of more relevant, problem-solving research. Each of these
steps will probably require an "affirmative action"-type editorial policy.
Simply requesting more such articles, the journal editors tell me, will
yield little change.
Another useful action would be to create additional outlets for case
study and applied policy-oriented research. Such research promotes the
goal of developing informed, relevant theory and empirical work that
tends to be excluded from mainline IR journals. The field could benefit,

180
 Industrial Relations in the 1990s & Beyond

therefore, from the creation of a new journal, monograph series, or

annual volume that would feature more applied, case study research.

IRRA
The future of industrial relations as a field of study also depends
significantly on the strategic choices made by the Industrial Relations
Research Association. The declining fortunes of the association in many
respects mirror those of the field in general, with the cause,and,effect
relationship going both ways.
The IRRA is caught up in the same intellectual contradiction as are
theIR academic programs and journals; namely, it professes allegiance
to the broad definition of industrial relations but practices the narrow
version. The IRRA needs to resolve this contradiction one way or the
other. Two approaches are possible: to maintain the current ILE ori,
entation of the organization and abandon the stated claim to represent
all segments of the IR and HR community or to retain the stated com,
mitment to represent all segments of the IR and HR community and
implement a series of wide,reaching changes to broaden the organiza,
tion's programs and membership.
The latter option would require that the association take at least five
actions: change its title to signify that it includes both the IR and HR
wings; establish an annual meeting date and place independent of the
Allied Social Science Association (an umbrella group of associations
that includes the American Economic Association) or rotate the annual
meeting so that one year it is with the economics group, another year
with the sociologists, and so on; expand significantly the number of
program sessions and annual research volumes devoted to HR topics;
give balanced weight and perspective at all association meetings and in
all publications to the practice of nonunion employment relations; and
provide equal political representation and access to high office to aca,
demics from the HR wing and executives and practitioners from non,
union companies.
I suspect that this package of revisions could not command sufficient
support in the IRRA to gain ratification. Nor could it be implemented
without significantly damaging and quite possibly destroying the viability
of the organization. I therefore advocate an alternative, second,best
strategy. It has three parts.

181
 Industrial Relations in the 1990s & Beyond

The first part requires people to accept that the IRRA will serve as
the professional association for only half the field-IR, not HR. At
the same time, the association should work to reposition its programs
and activities to make them consistent with the broader definition of
industrial relations advanced earlier in this chapter. In practical terms,
this means structuring the program of the winter meeting so that less
emphasis is given to collective bargaining topics and more to topics
related to the external environment and employment governance. This
also means making concerted efforts to encourage more active partici-
pation by scholars from externally oriented disciplines that are now
underrepresented (e. g., sociology, political science). A greater interface
between IR and HR scholars should also be encouraged, although the
focus needs to be on the themes that define the field (as opposed to an
open-ended session on organizational behavior research). Finally, the
association's name should be changed so that the term industrial relations
is dropped in favor of employment relations or some other more inclusive
label. 18
The second part of the strategy is for the IRRA to promote a wide-
ranging review of the underlying assumptions and policy program of
current-day industrial relations (i.e., to reexamine the problem-solving
face of the field). If the field is to enjoy a renaissance, the IRRA must
play a central role through its meetings and publications in developing
a new way of looking at the employment relationship that is consistent
with modem realities and that yields new practices and policies that
promote efficiency and equity. In particular, it must sponsor a variety
of paper sessions at meetings and dedicate annual research volumes to
a balanced, critical examination of the current system of collective
bargaining and labor law, proposals for change in the IR system, and
innovative employment practices and institutions in both the union and
nonunion sectors.
The third part of the strategy entails both reversing the decline in
membership of the national organization and increasing participation
by academics from outside the ILE school. This can be done by addressing
some serious structural issues. The first such issue concerns the academic-
practitioner interface. While the goal of encouraging a cross-fertilization
of ideas between academics and practitioners is excellent in intent, it
largely fails to accomplish its purpose and, worse, creates significant
disincentives for participation in the national association by academic

182
 Industrial Relations in the 1990s & Beyond

researchers. Academics are attracted to the association (and to the

winter meeting in particular) primarily for science-building reasons, most
notably the opportunity to discuss and publish scholarly research. In an
attempt to keep the discourse at a level that is accessible to practitioners,
however, the IRRA has imposed a variety of strictures that together
significantly weaken the incentive for academics to attend (e. g., short
page limits on published articles, practitioner discussants for academic
papers, the low level of rigor of accepted papers). The result is that
neither group is happy-the practitioners still find the meetings and
publications largely irrelevant to their concerns, while the academics
find them too watered down to be of real value.
One suggestion is to devote the winter meeting to science-building and
the spring meeting to problem-solving. Thus, the winter meeting be-
comes a strictly academic affair, and the sessions, paper selection process,
and published proceedings are structured with the goal of science-building
in mind. The spring meeting then becomes the forum for problem-solving
research. Thus, preference might be given in the paper selection process
to studies that use primary data sources, interviews with company and
union officials, and other methods of "hands-on" research.
The second structural problem confronting the IRRA is the timing
and location of the winter meeting. It is currently held at the same time
as the meetings of the other associations affiliated with the Allied Social
Science Association (ASSA), the most important being the American
Economic Association. This arrangement has both benefits and costs.
A major benefit is that more labor economists are able to attend the
IRRA meetings than would be the case if they were held separately from
the ASSA. This was a significant consideration in years past, when
economists represented the largest academic group in the association.
Now that economists represent less than one-fifth of the association's
academic membership, the synergies are less obvious. Another important
benefit is the substantial financial savings the IRRA obtains by piggy-
backing the winter meeting with that of the ASSA. On the cost side,
the current arrangement discourages participation by academics from
disciplines outside economics, either because they cannot afford to travel
to a separate set of meetings from those in their home discipline or
because they find the economics-dominated environment of the ASSA
meetings unattractive. It also perpetuates the perception that industrial
relations is an intellectual offshoot of labor economics.

183
 Industrial Relations in the 1990s & Beyond

No clear-cut resolution of this problem exists. The 1991 president of

the IRRA, James Stem, suggested in his presidential address (Stem
1992) that the winter meeting be rotated among the professional meet-
ings of all of IR's affiliated disciplines (i.e., one year it would be held
in conjunction with the American Sociological Association, the next
year with the American Political Science Association, and so on). He
also proposed moving the spring meeting to early summer, holding it
independently of any other association meeting, orienting it around
problem-solving, and making it, rather than the winter meeting, the
"showcase" meeting of the association. His suggested revisions regarding
the spring meeting seem to have considerable merit, but I fear that his
proposal to rotate the winter meeting among other professional asso-
ciations would result in substantially reduced attendance and a further
weakening of the core group of committed members. If forced to choose,
I would advocate holding the winter meeting at an independent time
and place from meetings of the ASSA or any other association. Although
this would reduce the attendance of economists in the short run, it
would materially benefit the association in the long run: participation
by academics from other disciplines would increase; it would provide
the association with an opportunity to redefine its mission and image
and, in the process, facilitate the repositioning of the field advocated
earlier; and it would allow the association considerably more freedom
to structure the meeting (e.g., number, length, and format of sessions)
in a way that participants would find most rewarding. 19
If the IRRA is to reverse the decline in membership and participation,
another structural change is necessary. This involves opening up the
organization in both a political and ideological sense to a wider range
of people and beliefs. Thus, the IRRA needs to take steps, in addition
to those already implemented as a result of the reports of the Lester
review committee ( 1977) and the Kerr-Dunlop review committee
(1988a), to ensure that all groups feel welcome and equally represented.
For example, a commonly voiced complaint of the academic mem-
bership is that there are too few competitive paper sessions on the
program. Having more such sessions would promote not only equal
opportunity but also higher-quality research. Ideological neutrality is
also important in the selection of sessions and papers, a goal that would
be advanced by delegating authority for the planning of the winter
meeting to academics only (a change that dovetails with the suggestion

184
 Industrial Relations in the 1990s & Beyond

made earlier to devote the winter meeting strictly to science,building

academic research). Finally, adopting a system of research "tracks" (e. g.,
labor economics, collective bargaining, labor law, human resource man,
agement, organizational behavior, and so on), much as in the Academy
of Management, is worth considering. Each track would have an elected
president who teaches and conducts research in that area and is re,
sponsible for planning one or more sessions and selecting papers. Such
a system would encourage participation in the IRRA by a wider range
of academics, help expand the topical and disciplinary base of the field,
and provide a broader political base for governance of the organization
and training ground for future leaders. Given the disenchantment of a
number of the members of the personnel and human resources track of
the Academy with the domination of that group by industrial and or,
ganizational psychologists, many from this group might participate more
actively in the IRRA if it provided them with an explicit home base
and had its winter meeting separate from that of the ASSA.

185
 SuMMARY AND CoNCLUSION

s EVERAL KEY POINTS have emerged from the analysis in this book.
The following section summarizes them.

SuMMARY

• The field of industrial relations was born in approximately 1920.

Two events marked its birth: the establishment at the University
of Wisconsin of the first academic program in industrial relations,
a concentration in industrial relations in the economics major; and
the creation of the first professional association dedicated to the
study and practice of industrial relations, the Industrial Relations
Association of America. The IRAA was a forerunner of the Amer-
ican Management Association.
• The establishment of the field was motivated by both science-
building and problem-solving considerations. The scientific motive
was a desire to advance the state of knowledge on the employment
relationship and, in particular, to understand better the causes of
the frictions between employers and workers. The problem-solving
motive was a desire to discover the means to resolve labor problems
through improved methods of organization and practice in industry
and the promulgation of progressive public policy. The end product
of these new practices and policies was to be increased efficiency in
production, equity in the distribution of economic rewards and au-
thority in the plant, and opportunities for personal growth and well-
being.

187
 Summary and Conclusion

• For the first two decades of IR's existence, the problem-solving

motive significantly outweighed the science-building motive in
drawing researchers to the field. The predominance of the problem-
solving motive imparted to IR research a heavy emphasis on fact-
gathering, the descriptive analysis of institutions and practices, a
multidisciplinary approach to the study of labor problems, and a
strong normative, policy-oriented perspective. In the decade and a
half after the end of World War II, the problem-solving motive
remained strong but greater emphasis was given to science-building.
The result was research characterized by its continued emphasis on
relevance, its multidisciplinary approach, and its use of case study
methods of empirical investigation combined with greater attention
to the development of theory and the use of scientific research
methods. After 1960, the major motive behind IR research became
science-building. This shift was associated with a decline in mul-
tidisciplinary research and case study methods of empirical fact-
gathering and in the relevance of the research to policy and practice,
coupled with a significant increase in the use of deductive model-
building, hypothesis-generating and testing, and the use of second-
ary data sources and advanced statistical techniques.
• From its earliest days, industrial relations was divided into two
major schools of thought regarding the best means to resolve labor
problems. The personnel management (PM) school maintained that
labor problems were caused primarily by defective management in
the form of poor business organization, workplace practices, leader-
ship styles, and communication. The methods advocated to resolve
these problems were the introduction of scientific methods into
personnel administration (e.g., formal selection tests and incentive
pay systems), the use of human relations practices in dealing with
employees, and the establishment of nonunion forms of employee
representation. The goal was a congruence of interests between
workers and the business organization, an end to industrial conflict,
and a joint commitment to the efficient operation of the enterprise.
By contrast, the institutional labor economics (ILE) school main-
tained that labor problems were caused primarily by two factors:
imperfections in the market system external to the business orga-
nization that tilted the plane of competition against employees and

188
 Summary and Conclusion

the autocratic nature of the master,servant relationship, in which

employees were denied democratic rights and the protection of due
process. The solution of labor problems involved various institu,
tional interventions, such as trade unions, protective labor legis,
lation, social insurance programs, and full,employment monetary
policies by the Federal Reserve Bank. The goal was a system of
economic and political pluralism (competition among socioeco,
nomic groups of roughly equal power) that ensured an equality of
bargaining power between labor and management, industrial de,
mocracy through the independent representation of workers by trade
unions, and a moderation of the adversarial relationship between
managers and workers through institutionalized methods of conflict
resolution.
• The PM school is built on two complementary fields of knowl,
edge: the organizational and administrative science part of the field
of management and the behavioral science disciplines of anthro,
pology, psychology, and sociology. The early (1920s) writers of the
PM school were primarily management practitioners and consult,
ants. The PM school entered academe largely through two routes:
the industrial relations sections established during the 1920s and
1930s at five American universities, principally through the efforts
of Clarence Hicks; and the research spawned by the Hawthorne
experiments at the Western Electric Company, as originally de,
scribed in the writings of Elton Mayo and later Fritz Roethlisberger
and William Dickson. The Hawthorne experiments, coupled with
other research efforts at the time (e.g., research on group dynamics
by Kurt Lewin), led to the emergence of the human relations move,
ment, which became the most important branch of the PM school
in the 1940s and 1950s.
In the late 1950s, human relations merged with the heretofore
separate branch of management research on the study of organiza,
tions and administration to form the new field of organizational
behavior. Organizational behavior and its applied offshoot, human
resource management (formerly personnel management), represent
the core of the modern,day version of the PM school.
• The intellectual foundation of the ILE school is primarily the
discipline of economics but with significant contributions from law,

189
 Summary and Conclusion

history, political science, and the macro wing of industrial sociology.

The founder of the ILE school, and of industrial relations as a field
of study in the United States, was the institutional economist John
R. Commons. During the 1920s and 1930s, the ILE school was
represented in academe mainly by labor economists, but after World
War II scholars from the other fields cited above also participated.
In the 1940s and 1950s, labor economics gradually split into two
branches, with one branch composed of ILE-oriented economists
(persons such as John Dunlop, Clark Kerr, and Richard Lester) and
the second branch composed of neoclassical-oriented economists.
The ILE group gradually drifted apart from their mother discipline
because of both their divergent research interests and disagreements
over theory and policy, with the result that by the late 1950s in-
dustrial relations had become their de facto home, leaving labor
economics proper under the control of the neoclassical group (e. g.,
H. Gregg Lewis, Gary Becker, Jacob Mincer). TheILE school con-
tinues to have its primary base of representation in the present-day
field of industrial relations, although both its membership and its
intellectual status have weakened significantly with the decline of
institutionalism as a scientific approach to the study of labor prob-
lems and the concomitant decline in the trade union movement.
• The golden age of industrial relations as a field of study occurred
during the fifteen years following the end of World War II. Public
interest in the subject reached a high point because of the rapid
spread of trade unionism and collective bargaining, the unprece-
dented level of strikes, and concerns over the balance of power
between labor and management and the impact of collective bar-
gaining on inflation and productivity. Numerous universities estab-
lished free-standing, multidisciplinary IR programs, and a new
professional association, the Industrial Relations Research Associ-
ation, and a new academic journal, the Industrial and Labor Relations
Review, were founded. Industrial relations was thus transformed from
a small-scale, relatively uninstitutionalized field of study in academe
to a major growth area of teaching and research with all the insti-
tutional trappings of a bona fide scientific field of inquiry.
• The period from 1945 to 1960 was also the high watermark with
respect to the disciplinary breadth and intellectual quality of research
in industrial relations. Scholars from fields as diverse as anthropol-

190
 Summary and Conclusion

ogy, psychology, history, law, economics, and political science be-

came active in industrial relations and contributed to a great
outpouring of articles and books on the organization and practice
of management, the structure and internal political process of
unions, and the process and outcomes of collective bargaining.
Another hallmark of the period was the heavy emphasis given to
interdisciplinary research as scholars made a concerted effort to
bridge disciplinary boundaries and meld theories and concepts into
a more holistic view of industrial relations. The outcome of this
effort was the production of a number of pathbreaking studies that
remain influential today. ·
• From the 1920s through the early part of the 1950s, the pro-
ponents of both the PM and the ILE schools perceived themselves
to be members of the field of industrial relations. Beginning in the
decade after the end of World War II, however, the bonds that had
held the various disciplines together weakened noticeably, resulting
in the 1960s in the dissolution of the confederation between the
PM and ILE schools. The causes of the divorce were, first, incom-
patibilities in their theoretical frameworks, research methods, policy
perspectives, and value systems (particularly regarding unions) and,
second, the incentives for disciplinary specialization in research
engendered by the growing emphasis in academe on science-
building.
After the late 1950s, the PM school largely dropped its association
with industrial relations and became a rival school of thought under
the HR (human resources) label, leaving the ILE school as the major
claimant of the field of industrial relations. What was once a con-
federation thus evolved into separate, competing fields of HR and
IR.
• Before the divorce of the PM and ILE schools, industrial rela-
tions could legitimately claim that all aspects of the employment
relationship were in its intellectual domain. By the late 1960s,
however, the perceived domain of industrial relations had narrowed
to the study of unions and collective bargaining and, of secondary
importance, the employment problems of special groups in the work
force (e.g., minority workers, the aged). This narrowing of focus
was a consequence of the departure of the PM school, and the
resulting dominance of industrial relations by the ILE school, and

191
 Summary and Conclusion

the pressures in academe for disciplinary specialization in research

engendered by science-building and the consequent spin-off of non-
collective bargaining related topics to other fields of study that had
better developed, more relevant bodies of theory.
Membership and active participation in the field also experienced
a distinct hollowing-out as faculty from the various disciplines
elected to remain apart from industrial relations because of the lack
of emphasis on the organization and practice of management, their
lack of interest in labor-management relations, their antipathy to
the pro-union value system predominant in industrial relations, or
their belief that the most fertile research opportunities were in in-
tradisciplinary work rather than in cross-disciplinary projects.
• The association of industrial relations with the study of unions
and collective bargaining, coupled with the decline in union density
and power in the United States, precipitated a corresponding decline
in the organizational and intellectual vitality of the field that began
in the early 1970s and accelerated in the 1980s. One casualty was
IR academic programs. Student demand shifted away from such
traditional IR courses as collective bargaining, IR theory, and union
government and administration toward HR subjects, such as com-
pensation and employee selection. Although most IR academic units
were able to accommodate this shift in demand in the short run by
augmenting the HR part of their faculty and curricula, their con-
tinued existence was clouded by the decline in the intellectual and
job market appeal of the IR label; the loss of a rationale for having
free-standing, multidisciplinary IR units; and the loss of political
support in local and state communities for the maintenance of ac-
ademic programs serving the organized labor movement. Although
the top-tier IR programs weathered the 1980s intact, other programs
were abolished, merged into a business school or management pro-
gram, or given a more HR-like title.
• The close association between the field of industrial relations
and the study of union-management relations also worked to the
detriment of IR research. Starting in the 1960s, IR research gradually
became more narrow in scope as scholars concentrated on labor-
management relations and the employment problems of special labor
force groups, most often from the perspective of labor economics
(both institutional and neoclassical). A corresponding decline in

192
 Summary and Conclusion

behavioral science research occurred, particularly on the organiza-

tion and practice of management. A degree of intellectual medi-
ocrity and staidness also afflicted IR research as labor-management
relations became institutionalized and the nonunion sector of the
economy became the locus of new innovations in employment prac-
tice and policy.
Paradoxically, the 1980s witnessed a modest increase in both
participation by behavioral science scholars in IR research and the
quality and policy relevance of the research produced by traditional
ILE-oriented scholars. These events were fueled at least in part by
the quest to understand both the causes and consequences of the
process of deunionization. It is reasonable to assume, however, that
if the union sector of the economy continues to decline, research
talent and resources in academia will gradually flow from IR (as
currently defined) to other more promising areas of study.
• The close link between industrial relations and the study of
labor-management relations also worked to the detriment of the
field's major professional association, the Industrial Relations Re-
search Association. The IRRA was intended to represent all the
disciplines and topical areas related to the subject of employment
relations. From the beginning, however, the organization has been
controlled by, and served the interests of, scholars affiliated with
the ILE school. The result has been that labor economists and other
institutionally oriented scholars interested in collective bargaining
have dominated the activities and research program of the associ-
ation, the mix of subjects in IRRA publications has been heavily
weighted toward labor-management relations, and the prevailing
ideology has been supportive of the New Deal system of collective
bargaining and protective labor legislation. As the organized labor
movement in the United States has declined in membership and
influence, the IRRA's continued focus on, and support of, the tra-
ditional system of labor-management relations has tended to isolate
it in the academic community. The appeal of the IRRA to new,
research-oriented scholars is also hurt by its attempt to keep its
meetings and publications "practitioner-friendly," a goal that pro-
motes a much-desired cross-fertilization of ideas between academics
and practitioners but at the cost of reduced scientific rigor and, thus,
opportunities for science-building.

193
 Summary and Conclusion

• The final chapter of the book examined the future of industrial

relations as a field of study. The conclusion was that if the organized
labor movement continues to decline in membership and political
power over the 1990s, as seems likely, and absent major changes
in the current structure and intellectual orientation of academic IR,
the number of academic programs, students, researchers, and teach-
ers will most likely contract further. It is argued, therefore, that
maintenance of the status quo is not a viable option for the field
and its major institutions. Fundamental change is necessary.
• One suggestion for change is to replace the term industrial re-
lations with a new label for the field, such as employment relations,
that is both more inclusive and contemporary-sounding. Another
suggestion is to reposition the intellectual boundaries and core sub-
ject matter of the field. Industrial relations should be defined along
the two dimensions that have guided teaching and research in the
field: science-building and problem-solving.
With regard to science-building, the focus of industrial relations
should be on the employment relationship and all the institutions,
practices, and outcomes associated with the world of work. An
intellectual fault line runs down the middle of teaching and research
on the employment relationship, however, and it is this fault line
that divides the subject into human resources and industrial rela-
tions. The field ofHR includes the internalists; that is, those scholars
who seek explanations for the outcomes of the employment rela-
tionship within individuals and organizations. Thus, HR scholars
typically come from academic areas such as organizational behavior,
human resource management, industrial and organizational psy-
chology and the micro end of sociology and focus on internal man-
agement and union practices, the social structure of organizations,
and psychological and social determinants of human behavior (e.g.,
trust, feelings of inequity, group cohesion).
The externalists, by contrast, typically come from academic areas
such as economics, law, history, political science, and the macro
end of sociology and focus on factors external to the organization
to explain employment-related outcomes, such as economic con-
ditions in product and labor markets, the body of law and judicial
opinion, the demographic, occupational, and rural versus urban

194
 Summary and Conclusion

structure of the local community or industry, and the prevailing

ideology, culture, and social norms of the nation.
These are several virtues to this division between IR and HR. It
implies that the two fields are different approaches to consideration
of the same subject (the employment relationship), rather than
separate fields of inquiry as is often assumed (labor relations versus
human resource management). It broadens the subject of IR from
unions and collective bargaining to a consideration of all aspects of
the employment relationship, and, by broadening the subject area,
it also increases the cross-disciplinary representation of researchers
active in IR. Yet, despite the widening of the topical and disciplinary
focus of the field, the external perspective still creates the basis for
a community of research interests among scholars (because of com-
plementarities in theory and methods across the externally oriented
disciplines) that will make participation in the field an intellectually
rewarding experience.
From a problem-solving perspective, the focus of industrial re-
lations should be on those methods, practices, and policies that
resolve labor problems and contribute to increased efficiency, equity,
and individual well-being in the workplace. The preoccupation of
present-day industrial relations with trade unionism and collective
bargaining reflects the long-held conviction of the ILE school that
these institutions (along with the other parts of the New Deal IR
system) are central to the attainment of these three objectives. Long-
term social and economic trends have undermined the effectiveness
of, and a portion of the rationale for, this approach to the resolution
of labor problems and, hence, a revised approach to problem-solving
is required. It is this revised approach that defines, in tum, the
problem-solving boundaries of the field of industrial relations. I
conjecture that this revised approach will emphasize several themes.
Some are quite similar to themes of the past, and others represent
a significant shift in emphasis. Among these themes are a continued
focus on the relations between workers and managers and a concern
for the protection of workers' rights and interests; a broadened em-
phasis on systems of workplace governance that subsume not only
traditional-style collective bargaining but also other forms of em-
ployee representation such as enterprise unions, works councils and

195
 Summary and Conclusion

self-managed work teams; continued concern with the causes of

worker-management conflict and its resolution; and a greater em-
phasis on promoting efficiency, competitiveness, and quality in the
production process through IR and HR policies.
Industrial relations as conceptualized above does not have a un-
itary topical focus or conceptual model but, rather, represents a
series of connected themes defined by the field's interests in both
science-building and problem-solving. The heart of the field lies at
the intersection of these two dimensions; that is, the impact of
external environmental forces on the organization and performance
of work and the resulting relations between employers and employ-
ees, and the development of a system of workplace governance that
is congruent with these external forces, promotes efficiency in the
internal operation of the organization, protects workers' equity in-
terests, and contributes to the development and growth of the na-
tion's human resources.

CoNCLUSION
The events of the last decade have been hard on U.S. industrial
relations and have raised the question of whether the field will survive
into the twenty-first century as anything more than a marginal area of
teaching and research. The prognosis for the field as it is currently
structured is relatively gloomy. I do not foresee IR going the way of
home economics, but, absent significant change, the future surely entails
a further shrinkage in the number of IR academic programs and faculty
with IR training and interests and in the organizational vitality and
membership of the IRRA.
These events are not foreordained, however. It is possible that my
assessment is overly pessimistic and academic IR will ride out the current
period of turbulence relatively intact. It is also possible that economic
and political events in the remainder of the 1990s will become favorable
for the field. Although I do not wish a crisis to befall the nation, the
history of the field clearly reveals that major disruptions to the em-
ployment relationship, be they in the form of war or depression, bene-
fit industrial relations by drawing public attention to the subject of
employer-employee relations and bringing academic researchers into
greater contact with the real world of employment practice and policy.
The odds do not favor either event, however. The evidence is over-

196
 Summary and Conclusion

whelming, I think, that the status quo position for the field is not viable
in the long run. Nor do I think industrial relations can count on an
economic or political crisis to save the day. A crisis of some sort may
well be brewing, judged by the growing perception among the populace
that the nation is embarked on a road of economic and social decline,
but the New Deal-era policy program associated with the field of in,
dustrial relations is more likely to be seen as part of the problem, not
the solution. The only path with real promise for industrial relations,
therefore, is change, both intellectual and institutional in nature.
Two aspects of this change process are crucial to the long,term fortunes
of the field. The first is a reconceptualization of the intellectual bound,
aries and core subject matter of industrial relations. Industrial relations
will secure its future only if it carves out a distinct intellectual area of
inquiry that is independent of specific institutions and practices (e.g.,
trade unions and collective bargaining). The approach I advocate defines
industrial relations as the study of the employment relationship from
the perspective of the environment external to the organization. This
definition would not only provide the field with a distinct place in the
social sciences but is consistent with the intellectual approach to the
subject taken by the ILE school from the early 1920s to the present.
The second equally important aspect of the change process is the
development of a problem,solving program for change in employment
practices and policy that promotes the objectives of increased efficiency,
equity, and individual well,being. Industrial relations scholars have for
too long accepted the verities of the past, with the consequence that
industrial relations is now seen as a reactive, out,of date field that has
little relevance for resolving the employment problems of the 1990s.
The challenge facing IR scholars is to reexamine the assumptions and
values that underlie the field, keep what remains valid and graft on new
material where necessary, and then develop and advocate a set of prac,
tices and policies that are both congruent with the intellectual foun,
dations of the field and responsive to the needs of employers, workers,
and the larger society.
Like all challenges to the status quo, this process carries the risk of
failure and the potential for conflict. If IR scholars can successfully meet
the challenge, however, the future of industrial relations will be bright
indeed.

197
 NoTES

INTRODUCTION
1. Industrial relations as both a concept and a field of study is largely Anglo-
American in origin, although interest in the field spread across the world
in the post-World War II period. In the chapters that follow, attention is
focused primarily on developments in the United States, although reference
is occasionally made to events and research in Canada and Great Britain.
Limiting the discussion to the United States, besides being a matter of
practicality, is justified to the extent that industrial relations first emerged
as a formal concept and field of study in the United States and many of
the field's most influential institutional and scholarly developments oc-
curred here. The downside is that the development of the field in the
United States, and consequently the conceptual and ideological perspec-
tives of U.S. researchers, are unique in certain respects to this country,
thus limiting the generalizability of the findings of this study.
For a survey of industrial relations thought and practice in Canada, see
Hebert, Jain, and Meltz (1988); asurveyofiR academic programs in Canada
is provided by Boivin (1991). For Great Britain, see Roberts (1972), Ber-
ridge and Goodman (1988), and P. Beaumont (1990). A summary of
developments in international IR is provided by R. Adams (1992).

l. THE ORIGINS OF INDUSTRIAL RELATIONS

1. The origins of the term industrial relations are obscure. Richard Morris
(1987) claims that the term first appeared in Great Britain as early as 1885,
while Thomas Spates (1944:6) states that in America the term "was born
of strife, unrest, and economic hardship among factory workers back in
1894." Although Spates is probably referring to the Pullman strike, he
does not give a specific reference. The Commission on Industrial Relations
got its name from a petition presented to President Taft on December 30,
1911, entitled "Petition to the President for a Federal Commission on

199
 Notes to pages 3-5

Industrial Relations" signed by twenty-eight people prominent in social

reform circles. The petition was also published concurrently in the Survey
(27 [December 30, 1911]: 1430-31). According to Morris (p. 535), the
first official usage of the term industrial relations did not occur in Britain
until 1924 with the creation of an Industrial Relations Department in the
Ministry of Labour.
2. The commission had an important impact not only in spawning the name
industrial relations but also in stimulating early academic research in the
field. John R. Commons, who would later be described by many (e.g.,
Kochan 1980; Barbash 1991b) as the father of industrial relations, was one
of the commission's nine committee persons. According to LaFayette G.
Harter, Jr. (1962:131-59), Common's field investigations and interviews
with company officials and workers during the hearings of the commission
were a rich source of inspiration and material for his subsequent writings
on labor issues. Robert Hoxie, another important figure in industrial re-
lations, was appointed to a research staff position and from his field work
later published an authoritative book on the subject of scientific manage-
ment (Hoxie 1915). Finally, a number of graduate students who later went
on to publish significant scholarly works in industrial relations, such as
Selig Perlman, William Leiserson, Sumner Slichter, Leo Wolman, David
McCabe, and Edwin Witte, were introduced to real-world labor problems
through their role as research assistants to the staff of the commission.
3. On this subject Leiserson (1929:127-28) states: "A generation ago it was
common to speak of The Labor Problem.... The most usual way of referring
to employers and their employees was in the abstract terms, Capital and
Labor; and the relations between the two were conceived as presenting a
more or less mechanical problem of removing the friction between these
opposing forces .... Then the idea of a single labor problem ... gave way
to the conception of a multiplicity of problems or evils, for each of which
separate, practical remedies were to be devised. But further study revealed
that what were evils from one point of view appeared as remedies from
another. Thus strikes, boycotts, and trade unions might be evils to the
employer; but to the wage earner they are remedies."
4. The transition from labor problems to personnel problems is indicated by
the interchangeable use of the two terms by Meyer Bloomfield (1923:3-
4): "All new countries are confronted with two typical personnel problems.
First, the scarcity of labor; second, the instability of labor. These are the
two most ancient of so-called labor problems." Although the term labor
problems gradually faded from the personnel literature, some authors con-
tinued to use the term through the late 1940s (see Jucius 1948).
5. The relationship between social Darwinism and classical economics is al-
luded to by Joseph Dorfman (1963:15-16): "Spencer [Herbert Spencer, the
leading English proponent of social Darwinism] asserted, in Social Statics
(1872 edition), 'that the poverty of the incapable, the distresses that come
upon the imprudent, the starvation of the idle, and those shouldering aside

200
 Notes to pages 5-12

of the weak by the strong ... are the decrees of a large far-seeing benev-
olence.' This conclusion was seized upon by the staunchest advocates of
dominant extreme laissez-faire economics as reinforcing their position."
6. The distaste of early American socialists and Marxists for industrial
relations is reflected in modem times by the paucity of academics of a
radical or Marxist bent who are active in the field. By contrast, a relatively
strong contingent of British academics approach the subject from a radical
or Marxist perspective (e.g., Hyman 1975). To some degree this reflects
the fact that economists have dominated academic IR research in the
United States, while sociologists and historians have played a larger role
in Britain.
7. Taylor's (1895) first paper on the subject of scientific management was
entitled "A Piece Rate System, Being a Step Toward a Partial Solution of
the Labor Problem."
8. Symptomatic of the growing use of the term was the publication in 1919
of Industrial Relations: A Selected Bibliography by the Russell Sage Foundation
Library. The bibliography was divided into two subtopics, employment
management and participation in management.
9. As far as I can determine, the first academic article containing the term
industrial relations in the title was chapter 1, "Industrial Relations," by John
R. Commons in the 1921 edition of Trade Unionism and Labor Problems (a
book of collected readings on labor). The first doctoral dissertation to have
the term in the title, "Industrial Relations in the West Coast Lumber
Industry," was written in 1923 by Cloice Howd (University of California,
Berkeley).
10. A fairly complete list of the local chapters still in existence as of 1940 is
in "Among the Local Industrial Relations Associations," Personnel17 (Au-
gust 1940): 79-83. The article states (p. 79), "Nearly every major city of
the United States and all important industrial regions have their local
industrial relations associations, whose membership is comprised of per-
sonnel executives from neighboring plants." Several of these local asso-
ciations, including the ones in Chicago and Philadelphia, remain active.
(The Chicago chapter changed its name several years ago to the Human
Resource Management Association, while the Philadelphia chapter con-
tinues to call itself an industrial relations association.)
11. Dale Yoder (1931: 123) states in this regard, "The most widely accepted
approach to the study of industrial relations is one which involves an
examination of phenomena that are usually described as labor problems."
12. J. Douglas Brown, director of the IR section at Princeton from 1926 to
1954, states (1976:5): "It was the intention of the founders [of the section]
to broaden the scope of the field studied to include aU factors, conditions,
problems and policies involved in the employment of human resources in
organized production or service. It was not to be limited to any single
academic discipline. Nor was the term 'industrial relations' limited to ac-
tivities within private enterprise but was assumed to cover the relations of

201
 Notes to pages 12-13

governments and all other institutions with those people who constituted
the working forces of the country" (emphasis in original). For a similar
view see Watkins (1922:5).
13. The map was reproduced in 1929 in Personnel journal 7 (5):391. A brief
discussion of the work of the committee that prepared the map is given
on pp. 390-93.
14. Stichter (1928:287-88) states in this regard: "There are two ways oflooking
at labor problems. One is from a scientific point of view .... It is aspired
to by the scientist who studies trade unions, child labor, unemployment,
in order to find out what is or what might be, without speculating about
what should be .... To the vast majority of people, however, even to the
economists and sociologists, the labor problem is more than this. It is also
a problem of ethics, a matter not simply of what is or what might be, but
of what should be .... From the ethical point of view, therefore, the labor
problem is concerned with two principal things: with the effect of the
prevailing economic institutions ... upon the conflict between life and
work, and with the institutional changes needed to harmonize men's ac-
tivities as laborers with their interests as men." The terms science-building
and problem-solving are from Barbash (1991a).
15. As detailed in the next chapter, the early literature on industrial relations
was written largely by two groups, academic economists and management
practitioners (with a modest contribution by industrial psychologists). Al-
though references to the goals of efficiency, equity, and enhanced individual
well-being can be found in the writings of both groups, the economists
tended to emphasize efficiency and equity while the management practi-
tioners and psychologists tended to emphasize efficiency and enhanced
individual well-being or happiness. This difference probably reflects a dif-
ference in disciplinary perspectives: the economists were trained to think
in terms of markets and the processes of production and distribution, while
the management practitioners and psychologists generally focused on the
interaction of managers and workers inside the firm, most often from an
individualistic, psychological frame of reference. The difference in emphasis
also reflected the greater weight the economists gave to the adversarial
nature of the employment relationship, a point of view that focused at-
tention on distributional or equity issues, while the emphasis among the
management practitioners and psychologists was on the congruence of
interests that exists in the employment relationship, a perspective that
tended to downgrade the saliency of equity issues. This difference in per-
spectives persists to the present day in the IR and human resources liter-
atures. Noah Meltz ( 1989: 109), for example, states that "industrial relations
is concerned with balancing efficiency and equity," while Richard Walton
(1985:36) states that "the theory [the new human resource management
model] is that the policies of mutuality will elicit commitment which in
tum will yield both better economic performance and greater human
development."

202
 Notes to page 20

2. THE SCHISM IN INDUSTRIAL RELATIONS

1. In his autobiography, Commons (1934a:170) explains the motivation for
his involvement in industrial relations: "What I was always trying to do,
in my academic way, was to save Wisconsin and the nation from politics,
socialism, or anarchism, in dealing with the momentous conflict of capital
and labor." He states in another place (p. 143), "I was trying to save
capitalism by making it good." In a similar vein, J. Michael Eisner (1967:5)
says of William Leiserson, a student of Commons who went on to a highly
influential career in industrial relations: "Although Leiserson was rooted
in the new economics and institutionalism, he was not an "institutionalist"
or a member of any formal school of thought. He was a pragmatic reform
economist who was concerned with individuals and their problems and not
with economic theory."
Two of the most prominent writers among management-oriented prac-
titioners of industrial relations in the pre-World War II period were Clar-
ence J. Hicks and Thomas Spates, both of whom wrote autobiographies.
Hicks had intended to become a lawyer but instead chose a life in industrial
relations because "the law was too far removed from people and their
everyday problems to satisfy an urge the good Lord had given me. The
next step brought me close to my goal, a life spent in working with people,
helping them in the job of earning a living and making it worthwhile"
(Hicks 1941:15). Spates (1960:50) says: "Up to the time of my going into
the army in World War I, most of my employment experiences followed
a pattern of mistrust, goldbricking, sabotage, petty theft, and a severe
economic waste, as expressions of resentment against inconsiderate lead-
ership .... It was about then, while reflecting upon my employment ex-
periences, that I resolved to devote my remaining time to trying to improve
the lot of my fellow man on the job."
2. This division of opinion was revealed clearly in the two industrial confer-
ences convened by President Wilson in the fall of 1919. The conferences
included distinguished representatives of employers, employees, and the
community who were brought together for the purpose of reaching joint
agreement on methods to be adopted in industry to eliminate the most
egregious sources of waste, inefficiency, and conflict in the employment
relationship. Both conferences ended in stalemate over the insistence of
the employers' group on the open shop and the insistence of the labor
group on the union shop and the replacement of nonunion employee
representation plans with bona fide collective bargaining. The divisiveness
posed by the issue of unionism also was manifested at the 1920 national
meeting of the IRAA in the speeches given by John McCone (1920), a
newspaper publisher and ardent promoter of the open shop, and the reply
by John R. Commons (1920).
3. Roy Adams (1983) distinguishes between four competing paradigms in
industrial relations: the labor market school, the political school (Marx-
ism), the management school, and the institutional school. The PM and

203
 Notes to pages 20-2 I

the ILE schools distinguished here correspond to the latter two. At least
in America, the former two are not, in my opinion, bona fide parts of
industrial relations since the systems of employment relations envisioned
(laissez-faire capitalism and socialism/syndicalism) were exactly what the
founders of the field were trying to avoid. If one thinks of alternative
systems of employment relations as ordered along a political and economic
continuum, the righthand end point would be the labor market school and
the lefthand end point would be the political school, with the management
and institutional schools in the middle (the institutional school would be
to the left of the management school). As discussed in chapter 1, the
founders of industrial relations desired to steer a middle course between
these two extremes, thereby promoting reform rather than reaction or
revolution. It is also apparent that early participants in industrial relations
regarded the field as divided into two competing schools of thought, not
four. Paul Brissenden (1926:444), for example, mentions two "lines of
thought" in industrial relations: the "academic line" of the economists and
the "labor-management line" of the personnel practitioners. A similar
division of thought is suggested by William M. Leiserson (1929:126), by
James Bossard and J. Frederic Dewhurst (1931:430), and by Martin Estey
(1960:93).
4. It is worth reiterating that the PM and ILE labels represent alternative
schools of thought or approaches to problem-solving in industrial relations,
not specific intellectual fields of study associated with science-building.
Thus, the label "PM" does not designate the field of personnel management
per se but rather represents the basic point of view held by personnel
professionals concerning the cause and resolution of labor problems. As
described in later chapters, the PM school grew to include academics from
a variety of fields, including human relations, organizational behavior, and
human resource management. While these academics differ significantly
with respect to the theoretical constructs and research methodologies used
in science-building, they nevertheless share a core set of beliefs about how
best to promote improved industrial relations in the workplace. This is
what the PM label is meant to connote. The same consideration applies
equally well to the ILE label, which is meant to be an umbrella term for
people who share a common set of beliefs about the source and solution
of labor problems, even though they may differ substantially in their ap-
proach to the study of labor markets. From a problem-solving perspective,
it is thus appropriate to combine the institutionalists of the Wisconsin
school and the "neoclassical revisionists" (Kerr 1983) of the 1950s, even
though from a science-building perspective the two groups had much less
in common.
5. The employment management movement started in Boston in early 1913
with the founding of the Boston Employment Managers' Association, a
group in which Meyer Bloomfield and Daniel Bloomfield played important
roles (Lange 1928). Other local associations were soon founded, followed

204
 Notes to pages 21-24

by the founding of the National Association of Employment Managers in

1919. This group then changed its name to the Industrial Relations As-
sociation of America in 1920 and, in tum, the National Personnel As-
sociation in 1922 and the American Management Association in 1923.
The first university course in employment management was offered at Dart-
mouth in 1915. The term employment management was largely replaced by
personnel management by the early 1920s.
6. Clarence Hicks, the leading exponent of the PM school among practi-
tioners, defined industrial relations for Scribner's Dictionary of American
History: "The term 'industrial relations' ... has grown to include all con-
tacts between labor and all grades of management, connected with or
growing out of employment. Specifically, it covers items usually classified
as personnel work" (Hicks 1941:x).
In a similar vein, William Leiserson (1929:126) states: "Personnel Man-
agement, being concerned with the management of employees in the in-
terest of business enterprises, must be clearly distinguished from the
scientific study of industrial relations, just as Labor Economics [the study
of the principles, methods, and policies wage earners and trade unions have
developed for managing their employers] is so distinguished. Unless this
distinction is made, hopeless confusion results."
Another piece of evidence on this matter is provided by the labor prob-
lems texts of the period (e.g., Watkins 1922; Furniss 1925). These texts
contained a survey of industrial relations theory and practice as it existed
in the 1920s. The surveys included extensive coverage of both the subjects
of personnel management and labor-management relations.
Finally, evidence comes from industry, where the typical company or-
ganizational chart placed both the staff functions of personnel management
and labor relations under the direction of the vice-president of industrial
relations (Roethlisberger and Dickson 1939; Aspley and Whitmore 1943).
7. An example of the conventional wisdom is provided by Keith Davis
( 1957 :5): "The term 'human relations' was used in business very little before
1940." Dozens of examples of its use can, in fact, be found.
8. The constitution of the National Personnel Association, created in 1923,
stated that the organization's purpose was "to advance the understanding
of the principles, policies and methods of creating and maintaining satis-
factory human relations within commerce and industry." A monograph
written by Whiting Williams in 1918, entitled Human Relations in Industry,
also used the term.
9. One of the most important findings of the Hawthorne experiments was
that informal work groups can either encourage or restrict individual work
effort and production. On this subject J. David Houser (1927:140) says:
"Like their employer, workers exercise control, though it is quite different
from his in extent and kind .... Whatever type of supervisors they may
have, individual employees can 'soldier' on the job, can practice sabotage
in a variety of ways, and can limit executive accomplishment. By group

205
 Notes to pages 24-25

action, they can multiply these gestures of protest many times over....
But on the other hand, there are vast and comparatively untapped reservoirs
of energy and interest which they can put at the service of industry .... "
On the next several pages Houser discusses two other themes later advanced
by Mayo and his colleagues, namely, the concept of equilibrium in the
social system of the plant and the overemphasis given to the role of financial
incentives in motivating work effort.
10. Although most of the influential writers in the PM school of the 1920s
were businessmen or consultants, many nevertheless had close ties to uni-
versities and actively participated in scholarly research. Sam Lewisohn, for
example, was vice-president of the Miami Copper Company, co-author
with John R. Commons and others of Can Business Prevent Unemployment?
(1925) and author of The New Leadership in Industry (1926), president of
the American Management Association, and chairman of the Industrial
Relations Research Committee of the Academy of Political Science. Other
members of the PM school who had close ties to universities or who
published research of a scholarly nature were Ordway Tead, Henry Metcalf,
Mary Parker Follett, Henry Dennison, Clarence Hicks, Chester Barnard,
and Arthur Young. Biographical sketches of these people, and of other
prominent PM writers of the 1920s, is provided in Spates 1960.
11. On this subject Lewisohn states (pp. 48-49): "To approach labor unrest
as if it were mainly due to peculiar defects of capitalism is thus a profound
error.... We should, therefore, focus our attention for a while on the
individual plant where the daily contact between employer and employee
takes place. Here is the starting point of any endeavor to improve indus-
trial relations." He goes on to say (p. 202), "There is no escaping the con-
clusion that the most important factor in sound industrial relations is
management."
12. Pyschology affected the development of personnel management in two
ways, first, through the development of theories of motivation, group dy-
namics, leadership, and other such factors associated with human relations
and, second, through its impact on particular personnel practices and tech-
niques, such as applicant interviewing, hiring tests, job analysis, and train-
ing. A major catalyst in this regard was the set of psychological experiments
conducted by the army during World War I involving aptitude tests and
rating systems. The practical applications of these experiments were soon
transferred to personnel practice in private industry after the war (Ling
1965). The psychological work associated with human relations had a major
influence on the field of industrial relations and is thus discussed at length;
the psychological work on specific personnel practices, while of major
significance to the development of personnel management per se, had only
a secondary impact on the broader issues associated with industrial relations
and thus is not discussed further. Much of the discussion of the PM school
in this chapter is derived from the writings of business practitioners and
consultants, not academic industrial psychologists. The reason is that the

206
 Notes to pages 25-32

industrial psychologists tended to focus on the narrow issues associated with

specific personnel practices, while the human relations themes were, at
least in the 1920s, more often the province of the practitioners and
consultants.
13. Mary Parker Follett (1925:82) states the idea thus: "When you have made
your employees feel that they are in some sense partners in the business,
they do not improve the quality of their work, save waste in time and
material, because of the Golden Rule, but because their interests are the
same as yours."
14. The term economic man as used in the 1920s referred to the assumption
that only pecuniary considerations motivate human behavior. Economists
have long since abandoned this conception of human behavior (if, indeed,
most ever believed it in the first place). The term is now used to connote
a model in which it is presumed that human behavior is guided by the
desire to maximize individual satisfaction, be it from pecuniary or non-
pecuniary sources, and that preference relations over items of choice satisfy
conditions such as transitivity, completeness, and nonsatiation (see Kauf-
man 1989b).
15. As indicated, the PM literature tended to have a "micro" focus on the
management of labor inside the plant and the relationships therein between
workers and managers. More "macro" issues concerning the structure of
organizations and the functions of management were addressed in a largely
independent stream of management thought by people such as Henri Fayol,
Max Weber, Chester Barnard, James Mooney, and Ralph Davis. These
two perspectives were integrated in the late 1950s when human relations
and organization theory were fused together to form the new field of or-
ganizational behavior (Wren 1987).
16. In 1886, Ely, Clark, Seligman, and several other economists trained in
Germany established the American Economic Association. According to
Ely (1938:132-64), the association was established to provide a forum for
the "young rebels" in the profession who opposed laissez-faire and favored
inductive, historical, and statistical research methods.
17. For purposes of this discussion, the institutional school includes any labor
economist who subscribed to these themes. Economists such as George
Barnett, Summer Slichter, Paul Douglas, and Harry A. Millis are thus
included, even though they were not "institutionalists" per se. The field
of labor economics was, in fact, segmented into several groups in the pre-
World War II years (Dorfman 1959; McNulty 1980). The earliest split was
between the labor economists, such as Barnett and Jacob Hollander at
Johns Hopkins University, and Ely and Commons at the University of
Wisconsin. Both groups were distinguished by their research on trade
unions, but Ely and Commons took a more normative, less analytic ap-
proach. Commons's approach was propagated in the 1930s by the "Wis-
consin school" of Selig Perlman, Don D. Lescohier, Edwin Witte, Elizabeth
Brandeis, David Saposs, and others, while the more analytic approach was

207
 Notes to pages 33-36

carried on by Summer Slichter, Paul Douglas, and Harry Millis. A perusal

of the three-volume set of labor texts by Millis and Royal E. Montgomery
(vol. I: Labor's Progress and Some Basic Labor Problems, 1938; vol. II: Labor's
Risks and Social Insurance, 1938; and vol. III: Organized Labor, 1945) clearly
reveals, nonetheless, that even these more "middle-of-the-road" labor
economists subscribed to the basic institutional point of view regarding
labor markets and labor unions.
18. The following passage from the Webbs (1897:658) gives the flavor of the
argument: "When the unemployed are crowding around the factory gates
every morning, it is plain to each man that, unless he can induce the
foreman to select him rather than another, his chance of subsistence for
weeks to come may be irretrievably lost. Under these circumstances bar-
gaining, in the case of the isolated individual workman, becomes absolutely
impossible. The foreman has only to pick his man, and tell him the terms.
Once inside the gates, the lucky workman knows that if he grumbles at
any of the surroundings, however intolerable; if he demurs to any speeding-
up, lengthening of the hours, or deductions; or if he hesitates to obey any
order, however unreasonable, he condemns himself once more to the semi-
starvation and misery of unemployment. For the alternative to the foreman
is merely to pick another man from the eager crowd, whilst the difference
to the employer becomes incalculably infinitesimal."
19. Commons was a tireless advocate of protective labor legislation, such as
workmen's compensation and unemployment insurance, and played an
important role in their eventual adoption in Wisconsin. His rationale for
these laws provides a classic illustration of the institutional perspective on
labor problems. Commons argued that the rates of both unemployment
and industrial accidents were far higher than was socially justified because
the market mechanism imposed little if any penalty on employers for high
numbers of layoffs or injuries and deaths. (In a competitive labor market,
firms that provide unstable employment or unsafe working conditions must
pay a correspondingly higher wage to attract a work force, thus motivating
them to stabilize employment and reduce accidents. Market defects, such
as externalities and public goods, however, reduce or eliminate these wage
premiums and thereby the incentive to reduce layoffs and accidents.) Com-
mons advocated using an institutional device (in this case a social insurance
program) to create a nonmarket incentive scheme to supplement the forces
of supply and demand. In particular, employers' contributions to the in-
surance funds are made a positive function of the number of their layoffs
and accidents. The net effect is that the tax rate in the insurance programs
provides an additional incentive for employment stability and increased
safety, thus leading to an increase in both efficiency and individual well-
being.
20. This divergence in perspectives is evident in the remarks of Frank Stockton,
dean of the business school at the University of Kansas (1932:224 ): "Labor
economics men who have the social point of view, coupled perhaps with

208
 Notes to pages 38-40

an anti-management complex, look with suspicion upon personnel man-

agement as a means of driving labor and eliminating trade unionism. They
disdain personnel further because of its apparent lack of theory. The per-
sonnel instructor, on the other hand, thinks that he at least is working in
terms of reality, and may be inclined to dislike the fault-finding tone of
labor economists and to belittle the socioeconomic approach to industrial
questions."
21. In this vein Commons (1911:466) states: "The employer's business is to
attend to the increase in efficiency; the wage earner's business is to sell
himself to do the employer's bidding. The two interests are necessarily
conflicting. Open conflict can be avoided in three ways: by the domination
of the employer; by the domination of the union; by the equal domination
of the two interests. The first and second methods do not solve the problem,
they suppress it. The third meets it in the same way that similar conflicts
are met in the region of politics; namely, a constitutional form of orga-
nization representing the interests affected, with mutual veto, and therefore
with progressive compromises as conflicts arise."
22. C. Canby Balderston was one of the few members of the PM school who
stressed the contingent relationship between economic conditions and per-
sonnel practices. He (1935:2) stated, for example: "To discuss industrial
relations apart from the economic forces that affect them is one of our pet
follies .... John Jones is not entirely his own master in dealing with his
employees. He too has a 'boss'-competition, usually harsh enough, but
at times an inexorable tyrant demanding that he choose between his an-
nounced personnel policies and the survival of his business."
The approach of most other proponents of PM to this issue took two
forms. One was to minimize the importance of the economic environment.
For example, Lewisohn (1926:226-27) states: "The real difficulty of labor
relations has been one of neglect. Executives have treated the question of
human organization as a minor matter not a major problem.... In some
countries other parts of the industrial fabric are so weak that the strength-
ening of this particular strand of labor relations could not make up for these
other weaknesses .... In this country we are suffering from no such eco-
nomic maladjustments. With our foundation of economic well-being, the
adoption of effective methods of human organization should have a max-
imum effectiveness, both in securing production and in promoting an iden-
tity of social interests."
Another approach was to counsel employers to focus on the long-term
goal of good labor relations, even if this meant sacrificing profits in the
short run. Thus, Catchings (1923:492-93) argued that wages and working
conditions should be based on fairness and fact, not economic conditions:
"The employer shall not, at any time, force upon the employee wages,
hours, and working conditions, merely because he has at the time the
economic power to do so .... At any time, for any company, there is a
fair wage that can be paid .... What this wage is, what these hours are,

209
 Notes to pages 40-41

what these conditions of employment are-these are questions of fact, to

be determined as such."
23. Commons (1911:4) says: "The fluctuation of the currency is the greatest
of all the labor problems .... If we could find a system of currency in which
the great price movements which have been occurring in all these years
could be stabilized, we would do more to stabilize industry, to bring about
industrial peace, than any other one thing."
Commons's emphasis on the macroeconomic origin of labor problems
was born out of the depression of 1920-11, an event that quickly led to
the liquidation of the new personnel programs and progressive employment
practices established during and shortly after World War I (Harter 1961:75-
76; Douglas 1911). In 1910, Commons, Wesley Mitchell, and Malcolm
Rorty founded the National Bureau of Economic Research, an organization
that pioneered the study of business cycles. Commons also became president
of the National Monetary Union, authored several scholarly articles on
monetary policy, and drafted legislation to require the Federal Reserve
Bank to stabilize the price level. Thus, although it is seldom recognized,
an important plank of Commons's institutional program was the use of
collective action in the form of Federal Reserve monetary policy to ensure
a stable, full-employment economy. On this subject, see Whalen 1991.
24. Proponents of the PM perspective recognized that some firms had substand-
ard labor conditions but maintained (as noted in the text) that the best
remedy was a positive one of education. In reaction to this argument,
Commons ( 1920: 130) stated in an address to the IRAA convention of
1910: "I have listened here to what seemed to me to be the most marvelous
and keen discussion of what employers could do, of what foremen could
do, of what management could do, and I am firmly convinced that if these
most informing discussions we have heard could be carried out ... the
capitalist system could be saved, that there will be no need of either
unionism or of revolution. But we know that will not be done; we know
that you are but a small number.... There is, therefore, a need for unionism
to supplement management."
25. The position of the institutionalists on this issue also conflicts with that
of neoclassical economists. The latter hold that the production of goods
and services should be so arranged that it maximizes the welfare of indi-
viduals in their roles as consumers, a goal promoted by production at
minimum cost. This fact, coupled with the penchant of neoclassical econ-
omists to view labor as an inanimate factor in production (such as is
generally the case in the production function literature), leads them to
oppose in principle union work rules, such as restrictions on the speed of
the line or promotion on the basis of seniority. Institutionalists, however,
hold that restrictive practices by unions can promote the social welfare
and thus are not to be rejected out of hand. Their position is based on the
idea that labor is embodied in human beings and human beings have an
interest not only in low prices for consumption goods in the marketplace

210
 Notes to pages 42-47

but also in safe and humane working conditions at the work site and that
some balancing of these interests is appropriate. A recent statement of this
position is provided by Lester Thurow (1988).
26. A belief in the social efficacy of pluralism is one of the strongest philo-
sophical threads running through the ILE school from Commons's time to
the present. See, for example, Kerr (1954b) and the winter 1983 issue of
Industrial Relations. The latter contains a report (pp. 125-31) on a two-
day conference attended by twenty-nine leading IR scholars on "The Future
of Industrial Relations." The last paragraph of the report states: "The
conference closed with what came close to a consensus: our economic and
social problems can best be resolved through tripartite union-management-
government discussion and collaboration. No better model was presented."
Also see Dunlop (1984b) and Schatz (1993).

3. INDUSTRIAL RELATIONS IN THE INTERWAR YEARS

1. A fifteen-month strike at the company was finally broken in 1914 when
National Guardsmen stormed a miners' village and killed twenty people,
an event that became known as the Ludlow massacre. Rockefeller was
widely excoriated for his alleged culpability in the disaster, a public reaction
that motivated him to take a strong personal interest in industrial relations
and progressive personnel practices {see Rockefeller 1923).
2. The unbalanced view of industrial relations contained in many of the texts
used in introductory labor courses was attested to by Dale Yoder (1931:125):
"It [the labor problems text] is apt to portray modem industry as though
it were in the agonizing throes of a host of diseases. It probably misrepresents
the feelings of both workers and employers, and, at best, it presents a
distinctly one-sided picture."
3. Hicks ( 1941: 150) mentions in his memoirs that the University of Wisconsin
had agreed to create a sixth industrial relations section. Although the
Department of Economics approved the creation of the section in 1939
(stated in unpublished departmental minutes, as told to me by Robert
Lampman), for unknown reasons the section never came into existence.
Given that Wisconsin was the home of the ILE school of industrial rela-
tions, the section, had it materialized, would have been something of a
coup for Hicks in his efforts to provide "balance" in the teaching of in-
dustrial relations.
4. A businessman also played a key role in introducing industrial relations
into British universities. According to Benjamin C. Roberts (1972), in the
early 1930s Montague Burton, a clothing manufacturer, donated funds for
the establishment of three chairs in industrial relations at Cambridge,
Cardiff, and Leeds. His expressed reason for doing so was to promote peace
between labor and capital. These chairs were apparently the first time that
industrial relations was formally represented in British academe.
5. Of the five IR units Hicks created in the United States, the two most
successful have been the ones at Princeton and at MIT. They remain in

. 2I I
 Notes to pages 47-53

existence and continue to produce noteworthy research. In contrast, the

units at Stanford and at the California Institute of Technology never es-
tablished a perceptible presence in the field. The Stanford unit was dis-
continued in the late 1960s upon the retirement of Dale Yoder. The unit
at the California Institute of Technology remains in existence but does
little work in industrial relations. Its primary mission is to sponsor extension
classes and research on the management of technology. The situation at
Michigan is in some respects the most interesting. Upon Hicks's instigation,
a bureau of industrial relations was established in the school of business in
1935. Its primary function was noncredit management education. In 1960,
in conjunction with Wayne State University, the university established
another IR unit outside the business school, called the Institute of Labor
and Industrial Relations. The focus of the institute was on labor-
management relations, and it offered on-campus courses and sponsored
research. Thus, until the late 1960s, when the bureau was phased out,
Michigan had two IR units that existed side by side, one representing the
PM school and the other the ILE school.
6. The first IR department in the United States was established in 1944 at
Rockhurst College, a Jesuit school in Kansas City (Bradley 1945). Although
no stand-alone industrial relations program existed in the interwar years,
industrial relations was nevertheless recognized as a distinct area of study
in academe, albeit of small size. In their survey of the forty-two member
schools of the American Association of Collegiate Schools of Business
(AACSB), for example, Bossard and Dewhurst (1931:314) found that 14
of the 1,398 faculty at these schools claimed industrial relations as one of
their areas of specialization (compared to 31 for personnel management
and 48 for labor).
7. As an example, in the introductory chapter of his labor text Labor Economics
and Labor Problems (1933:1-22), Yoder provides an extensive discussion of
the subject matter of labor economics and the origins of labor problems
without once mentioning the terms labor market and supply and demand.
8. Several aspects of the figure are questionable. First, the institutional
economics branch and the industrial and labor economics branches con-
tain numerous names that have a dubious connection to those fields;
one could argue that people such as Commons, Witte, and Perlman
belong on the institutional branch, not the labor economics branch.
Second, the sociometry and sociatry and group dynamics branches would
appear to have had a sufficiently modest impact on industrial relations
that they should not be identified separately. Third, a good case could
be made that the public administration and industrial management
branches should be merged together. Fourth, the fields of labor history
and labor law are omitted altogether. These quibbles aside, the figure
provides compelling evidence that into the 1950s industrial relations
included in both theory and fact a wide range of disciplines from both
the behavioral and nonbehavioral sciences and that behavioral science

212
 Notes to pages 54-56

scholars such as Miller and Form saw themselves as participating members

of the field of industrial relations.
9. Commons deserves the title "father of American industrial relations" on
several counts: he was the foremost academic expert of his day on labor
issues, a fact revealed by his selection to serve on the Commission on
Industrial Relations; more than any one person he was responsible for the
establishment of industrial relations as a field of study in academe in this
country; although he was an advocate of the ILE perspective, he wrote
influential scholarly works that pertained to both the management and the
labor sides of industrial relations. A thorough discussion of Commons's
contributions to the development of industrial relations is provided in
Barbash 1991b.
In Britain, the "fathers" (perhaps more accurately the father and the
mother) of industrial relations were Sidney and Beatrice Webb. Their two
works on labor, A History of Trade Unionism ( 1894) and Industrial Democracy
(1897), were landmark studies. The latter, in particular, represents in my
view the bible of the ILE perspective on industrial relations. Unlike Com-
mons, however, despite their profound intellectual impact on industrial
relations, the Webbs did little to institutionalize the subject in British
universities. As detailed by Roberts (1972), the Webbs founded the London
School of Economics (LSE) but made no efforts to introduce the study of
labor into the curriculum. This reflected, according to Roberts, the Webbs's
belief that the study of labor problems was not sufficiently "scientific" for
LSE, the fact that their research interests shifted from labor to issues of
local government and social administration, and their growing estrange-
ment from the trade union movement.
10. One indicator of the expansive nature of economics during this period was
the publication of various management-related articles in the leading jour-
nals of the field. Examples include Stichter's article "Industrial Morale"
(1920), in the Quarterly Journal of Economics, and Tead's article "The
Problem of Graduate Training in Personnel Administration" (1921), in
the Journal of Political Economy. Another indicator is the diverse range of
courses offered by the typical economics department. At Wisconsin, for
example, courses in employment management, general sociology, and social
psychology were all listed under the department's course offerings in the
1920s. A similar situation existed at MIT through the late 1940s, where
the Department of Economics and Social Sciences offered courses ranging
from Paul Samuelson's doctoral seminar in microeconomic theory to Doug-
las McGregor's seminar on human relations.
11. Edwin Witte, a student of Commons, states (1954: 131-32): "In the last
quarter century of his life, Commons tried to pull together into a compre-
hensive, systematic body of economic thought the theoretical ideas he
developed out of the work he did on practical public policy issues .... They
were lost on me. I confess I have had the same difficulty following Com-
mons' terminology and some of his reasoning which so many students of-

213
 Notes to page 57

his later theoretical writings have experienced." He goes on to say (p.

133): "Institutional economics, as I conceive it, is not so much a connected
body of economic thought as a method of approaching economic problems .
. . . In seeking solutions of practical problems, they [the institutionalists]
try to give consideration to all aspects of these problems: economic (in the
orthodox use of that term), social, psychological, historical, legal, political,
administrative, and even technical."
The association of institutionalism with a particular methodological ap-
proach to research, rather than a theoretical point of view, is not unique
to Witte. In a "Notice to Potential Contributors" in the October 1989
issue of Industrial and Labor Relations Review, the editors (p. 4) say: "We
wish to receive more 'institutional' papers. Scholars and practitioners in
our field ... have long debated the implication of the trend among re-
searchers toward model building and quantitative analysis .... Some readers
may have concluded that because the proportion of Review articles con-
taining quantitative analysis has escalated so rapidly in recent years, we
have taken sides in the debate on methodology and have abandoned the
institutionalists. That is decidely not the case."
I maintain that both Witte and the editors of the Review have funda-
mentally misinterpreted the essence of institutional economics, which was
an attempt to construct an alternative theoretical paradigm based on a
behavioral model of man, models of imperfect competition in markets, and
the important role played by institutional (organizational and sociological)
factors in resource allocation. Although Commons was unable to articulate
such a paradigm successfully (hence the confusion by Witte and the editors
of the Review), it is nevertheless clear that this was his goal.
The editors of the Review also err in associating institutional research
with a nonquantitative approach. The institutionalists' fundamental cri-
tique of neoclassical economics is that the theory is derived from assump-
tions that in some cases diverge widely from reality. The solution to this
problem is not so much an inductive style of research as an adductive style,
where adductive means using detailed historical and empirical investiga-
tions to determine the facts of a situation from which correct theoretical
assumptions can be adduced. The point, then, is that institutional research,
far from being nonquantitative as alleged by the editors of the Review, is
by its very nature heavily empirical and quantitative both in the formulation
of theories and in the testing of the hypotheses of these theories, as evi-
denced in the 1920s by the central role played by Wesley Mitchell and
John Commons in the founding of the National Bureau of Economic
Research.
12. In 1931, R. M. Berg published a bibliography of management literature.
The section entitled "industrial relations" contained more than 150 cita-
tions, most to nonacademic periodicals such as the Bulletin of the Taylor
Society and Industrial Management. Also see Milton 1960 for more such
references.

214
 Notes to pages 57-63

13. The opinion of Richard Lester and Maurice Neufeld as stated in telephone
conversations.
14. Mention should also be made of the Personnel Research Federation, a
nonprofit group founded in 1921 to promote "the cooperation of research
activities pertaining to personnel in industry, commerce, education, and
government" (U.S. Department of Labor 1921:111). Interestingly, one of
the charter members of the group was the American Federation of Labor.
The Personnel Research Federation sponsored numerous conferences and
publications on industrial relations-related topics, including Stanley Ma-
thewson's (1931) well-known monograph on restriction of output among
unorganized workers and the monthly periodical Personnel Journal. Al-
though Personnel Journal became largely practitioner-oriented after 1935
(because of a change in editors), before then many of its articles had a
significant research element. It is noteworthy, for example, that seven of
the ten members of the editorial board in the early 1930s were academics
(including Wesley Mitchell from economics and Morris Viteles from in-
dustrial psychology), but not one was a business person.

4. THE INSTITUTIONALIZATION OF INDUSTRIAL RELATIONS

1. Keynes's book The General Theory of Employment, Interest, and Money was
not published until 1936, three years after Franklin Roosevelt's election
to office, and the ideas in it (activist use of monetary and fiscal policies to
keep aggregate demand at a full-employment level) were not fully incor-
porated into government economic policy until the early 1960s (Stein
1990). Although there was relatively little interaction between Keynesian
macroeconomists and institutional labor economists, the two schools of
thought were nevertheless highly complementary in that both stressed the
imperfect nature of markets, particularly the labor market, and both pro-
vided a rationale for government intervention in the economy. The link
between modem-day Keynesian economics and institutional economics is
discussed in Appelbaum 1979 and Whalen 1991.
2. The preamble of the Wagner Act states, "The inequality of bargaining
power between employees who do not possess full freedom of association
or actual liberty of contract, and employers who are organized in the
corporate or other forms of ownership association ... tend to aggravate
recurrent business depressions, by depressing wage rates and the purchasing
power of wage earners in industry and by preventing the stabilization of
competitive wage rates and working conditions within and between
industries."
3. The strong impetus given to the creation of new IR programs by public
concern over the breadth and depth of labor-management conflict after
the war is evident in the events surrounding the founding of the Industrial
Relations Research Institute at the University of Wisconsin. In 1947, the
board of regents directed the university "to study ways and means to protect
the public interest in labor-management disputes"; and in 1949, the Wis-

215
 Notes to pages 63-64

consin State Journal said of the newly created institute that it provided "a
giant microscope into which to peer into America's number one domestic
problem, Big Business versus Big Labor" (quoted in Fried 1987:2-3).
4. A brief description of these programs (with the exception of the one at
the University of Hawaii) is given in Industrial Relations Counselors 1949.
Detailed histories of the IR programs at Illinois and Wisconsin are provided
in Derber 1987 and Fried 1987. The establishment of IR units and devel-
opments at existing units are also chronicled in the "News and Notes"
section of each issue of the Industrial and Labor Relations Review.
5. While the immediate post-World War II period saw a tremendous expan-
sion in industrial relations programs in America, the same was not nearly
so true in Canada and Great Britain. Canada saw the establishment of an
IR institute at Laval University in the mid-1940s and the subsequent pub-
lication of an IR journal, Industrial Relations-Quarterly Review (R. Adams
1992). The major expansion of IR programs, and the establishment of the
Canadian Industrial Relations Association, did not occur until two decades
later, however. Speaking of the situation in Britain in the postwar period,
John Berridge and John Goodman (1988:156) state, "Prior to the 1960s,
the process of acceptance of industrial relations in the academic world was
slow and problematic." Although the British Universities Industrial Re-
lations Association was founded in 1950, the major period of growth took
place from the mid-1960s to the late 1970s. The most important British
IR programs in the 1960s were at Oxford University, Cambridge University,
and the London School of Economics. In the 1970s, the IR program at
Warwick University became the leading center for industrial relations re-
search in Great Britain. This disparate pattern of growth in the three
countries in IR largely reflects different cycles of union growth and accom-
panying public concern over issues such as strikes and inflation.
6. According to Derber (1987) and Fried (1987), the creation of the IR
institutes at Illinois and Wisconsin was actively opposed by the schools of
commerce at each university. The frosty relations between theIR institute
and the school of commerce at Illinois is illustrated by the fact that as
many as six faculty members from economics and one to three from so-
ciology and psychology but only one from the business school held joint
appointments with the institute in the 1950s (Derber 1987:28). While the
situations at Illinois and Wisconsin were the norm in this regard, there
were exceptions. At Berkeley, for example, a majority of the IR faculty
held joint appointments with the business school, and the two units main-
tained a relatively amicable relationship (George Strauss, personal cor-
respondence).
7. The compromise worked out at Illinois was that the IR institute was to
specialize in labor relations and the school of commerce was to specialize
in management. Both units shared responsibility for subjects dealing with
the interaction of labor and management (Derber 1987:16).

216
 Notes to page 65

8. The low interest in personnel management among students can be inferred

from data presented by Robert A. Gordon and James E. Howell (1959:260).
They surveyed thirty-three schools of business accredited by the American
Association of Collegiate Schools of Business and found in 1955-56 that
only 25 percent required a human relations or personnel course as part of
their graduate course requirements. Of these schools, only one (3 percent)
required a course in industrial relations.
9. Julius Rezler (1968a) reports the results of a 1967 survey of forty-seven IR
units. Only six (Cornell, Illinois, Loyola-Los Angeles, Massachusetts,
Michigan State, and Utah) qualified as "full-service" programs. Fifteen
units offered degree programs, thirty were involved in nondegree labor-
management education, and seven limited their activities to research (e.g.,
Chicago, New York).
10. The Ph.D. degree at Wisconsin was established in 1956 and, according to
Amy E. Fried (1987:15-17), was the subject of some controversy among
the university faculty. The principal arguments advanced in its favor were
that it promoted a cross-disciplinary perspective on employment relations,
facilitated students' ability to take courses in different academic depart-
ments, and enabled students to acquire the blend of theory, methodology,
and concepts most relevant to their precise research interests. L. Reed
Tripp, director of the institute at the time (then called a center), explained
the motivation for the program this way (quoted in Fried 1987:16): "A
labor economics student would have to meet a lot of rigid requirements to
get a degree. What we really would prefer is proficiency in labor economics
combined with a little bit of psychology, business, and law." Arguments
against the program were that it lacked a conceptual foundation, fostered
undesirable competition for students between the IR center and traditional
departments, and was likely to produce weak researchers since students
would have considerable breadth but little depth in the theory and methods
of any one discipline.
In hindsight, the decision by Cornell, Wisconsin, Illinois (in 1966),
and other universities to offer doctoral programs in industrial relations was
clearly a mixed blessing. On the one hand, the programs conferred legit-
imacy to the field, helped institutionalize it in the academic community,
and provided a source of new faculty who were trained specifically for
careers in research and teaching in industrial relations. On the other hand,
the programs intensified the pressure to develop a unique theoretical core
for the field in order to promote model-building and hypothesis-testing (the
primary skills one learns in a Ph.D. program). This pressure was reflected
in the creation of IR theory courses in graduate curricula and in the pub-
lication of various research works (such as John T. Dunlop's Industrial
Relations Systems in 1958) that attempted to elucidate a general theory of
industrial relations.
The problem set off by the quest for IR theory was that it conflicted

217
 Notes to pages 65-67

with the field's multidisciplinary structure, given that rigorous, formalized

theory is extremely difficult to construct across disciplinary lines. The result
was that the imperatives of science-building inherent in IR doctoral pro-
grams contributed significantly to the pronounced narrowing of the intel-
lectual boundaries of the field that took place after 1960. This subject is
discussed at length in chapter 6.
11. Many of the IR units with jointly appointed faculty have encountered
increasing difficulty in recent years in obtaining new faculty with the desired
research and teaching interests. In the 1950s, for example, a labor econ-
omist who was hired by an economics department was.generally similar in
orientation to the economist an IR unit might hire, gi~en the institutional
orientation of most labor economists of that period. In recent years, how-
ever, the Chicago-style neoclassical labor economist that most economics
departments seek to hire is of limited appeal to IR units, while the insti-
tutionally based labor economist desired by IR units faces great difficulty
in getting hired by economics departments. This situation led the IR unit
at Wisconsin to petition the university (unsuccessfully) in the late 1970s
for departmental status (Fried 1987:36-43).
12. The virtues of the interdisciplinary approach were cogently expressed in
the first bulletin issued by the newly founded IR section at the California
Institute of Technology (IRS Cal Tech 1939:9): "In many fields, further-
more, it is being discovered that various branches of the social sciences
(economics, political science, history and social ethics), if used in con-
junction with one another, offer clearer insight into the causes of social
phenomena, as well as a more realistic measurement of effects and greater
promises of 'solutions' than does any alternative approach" (emphasis in
original). The considerable emphasis placed on the interdisciplinary ap-
proach in the new IR units created after World War II arose in part from
the involvement of many IR academics in the activities of the War Labor
Board and other such government agencies. These experiences impressed
upon them the multifaceted nature of wage determination, collective bar-
gaining, and industrial conflict.
13. TheILE orientation of the Cornell program is suggested by the dispropor-
tionate share of the faculty who taught and conducted research in the areas
of labor economics, collective bargaining, and labor law. Two other pieces
of circumstantial evidence support this claim. One is from a report {"Report
of the Board of Temporary Trustees of the New York State School of
Industrial and Labor Relations, State of New York Legislative Document
no. 20, 1945) submitted to the state legislature which contained the jus-
tification for the establishment of the school and an explanation of its
intended structure and mission. The report contained an appendix prepared
by Phillips Bradley that presented the results of a survey of all academic
and nonacademic educational programs offered in the United States per-
taining to the relations between labor and management {thirty-seven pro-
grams altogether). A notable feature of the survey was that it included

218
 Notes to page 68

labor education programs but excluded any mention of personnel programs,

suggesting that the emphasis of the school was intended to be on the study
of unions and labor-management relations.
The second piece of circumstantial evidence comes from the name cho-
sen for the school. The term industrial relations, as originally conceived,
suggested that the program would cover all aspects of the employment
relationship, while the inclusion of the modifier and labor relations was
presumably included to indicate that particular emphasis was to be given
to labor-management relations (thus giving the program, on net, an ILE
emphasis).
While a substantial majority of the school's faculty were from the ILE
wing of industrial relations, a significant minority represented the PM wing.
For example, in the early 1950s, the faculty in the personnel, human
relations, and industrial education (training) areas included Charles Beach,
Earl Brooks, John Brophy, Temple Burling, Alexander Leighton, and Wil-
liam Foote Whyte.
14. TheILE orientation of the Wisconsin IR unit is suggested by the following
remarks of Gerald Somers (1967:740): "It is not surprising, then, that
much of the early research and activities of the Institute centered on
the University of Wisconsin's long-standing interest in the problems of
collective bargaining and the law of labor-management relations. Under
the direction of Professors Witte, the late Selig Perlman, Elizabeth Bran-
deis, and others in the Department of Economics, and of Professors
Nathan Feinsinger, Robben Fleming, and Abner Brodie of the Law
School, large numbers of graduate students, in keeping with the John
R. Commons tradition, engaged in the study of the organization, history,
and legal-economic problems of particular national unions and of union-
management relations as a whole." The ILE interests of the Illinois
faculty is suggested by Melvin Rothbaum (1967:733-35): "The faculty
agreed that the interdisciplinary approach to the study of labor-
management problems would be the most meaningful and defined three
broad areas for the first phase of a long-range research program: labor-
management relations in the community setting, labor legislation and its
administration, and wage employment and related trends." William A.
Faunce (1967:737-38) listed four major areas of research interest among
the faculty of the Michigan State IR unit: automation and manpower
retraining, international aspects of labor and industrial relations, collec-
tive bargaining, and labor history and trade union administration. It
should be noted that no PM-related topic was mentioned as a major area
of interest at any of these three IR units.
15. In their comprehensive review of business education, Gordon and Howell
(1959:189) state: "Next to the course in production, perhaps more edu-
cational sins have been committed in the name of personnel management
than in any other required course in the business curriculum. Personnel
management is a field which has had a particularly small base of significant

219
 Notes to pages 69-70

generalization with which to work (beyond what is important in the area

of human relations), and, partly for this reason, it is an area which has
not been held in high regard in the better schools." Also see Drucker
(1954) and Dunnette and Bass (1963).
Few members of what I have labeled the PM school engaged in personnel
research per se, and several criticized the field for its intellectual shallowness
(see Whyte 1944). It may be questioned, therefore, whether it makes sense
to include these people in something labeled the PM school when they
lacked significant intellectual interest in or sympathies for the subject. To
resolve this paradox, it must be remembered that the PM school is defined
as an approach to problem-solving. This approach, first articulated in the
personnel management literature of the 1920s, is one the human relations
and management academics of the 1950s (such as Whyte) also subscribed
to in broad outline. Thus, it is quite consistent for these people to have
criticized personnel management in its science-building mode yet to be
classified as members in good standing of the PM school of problem-solving.
16. Derber (1987:14-15) describes the experience at Illinois as follows:
"Perhaps the high point of business distrust and hostility came in the
spring of 1949, when several legislators ... accused the Institute of pro-
labor and Socialist sentiments, attacked the Institute director for once
being a member of the Society for Cultural Relations with Russia, and
castigated a faculty member for allegedly telling the campus Socialist Club
that there was 'more incentive for workers under Socialism than under
capitalism.' They called for disciplinary action against the faculty member
and a reduction in the university appropriation for the Institute." Clark
Kerr, the first director of the Institute of Industrial Relations at Berkeley,
related in a telephone conversation that he was visited by a group of
businessmen who threatened to have the governor eliminate funding for
the institute if it did not cease its "pro-union" activities (e.g., labor
education).
17. A brief history of the founding of the IRRA is provided in the front of the
first proceedings of the association (published in 1948). I have also benefited
from extensive discussions on this subject with Richard Lester and Clark
Kerr.
An important antecedent of the IRRA that has gone largely unnoticed
in the literature is the Labor Market Research Committee of the Social
Science Research Council, which was organized in the late 1930s to pro-
mote social science (i.e., multidisciplinary) research on labor market phe-
nomena. Directed by Paul Webbink, it included as members many of the
labor economists who would later be leaders of the IRRA. The activities
of the committee were an important influence on the birth of the IRRA
in three respects. First, the committee sponsored conferences on IR research
(the first such meeting was the "Conference on Research on Industrial
Relations," held at Harvard University in April 1939) that helped generate
academic interest among economists on the subject of industrial relations.

220
 Notes to pages 75-79

Second, it held periodic meetings where labor economists interested in

industrial relations could get to know one another and discuss and develop
research projects of mutual interest. Third, starting in 1945, the committee
sponsored an annual labor-management conference at the University of
Minnesota that served as an important role model for the programs of the
future IRRA.

5. THE GOLDEN AGE OF INDUSTRIAL RELATIONS

1. The term golden age comes from Strauss and Feuille (1981), although they
use it to refer to the period 1935-59.
2. The high degree of interest in the study of industrial relations during this
period was attested to by Witte (1947:7), who noted that "there are more
members of the American Economic Association who list labor as their
major field of interest than any other." Witte also noted that a 1944 survey
of the postwar plans of armed service members concluded that "industrial
relations ranked only below engineering and accounting in the choices of
service men and women who were thinking of a college education."
3. The factual validity of these conclusions, as opposed to their implications
for policy and practice, were not seriously challenged until forty years later,
when the original data were reanalyzed using modem multivariate statistical
techniques. The first study to do so by Richard H. Franke and James D.
Kaul (1978), found that human relations practices played only a minor
role in explaining the variations in output of the relay assembly workers.
The more important variables were variations in the external economic
environment, managerial control of the work process, and the number of
rest periods. Franke and Kaul's conclusions were subsequently called into
question by Schlaifer (1980), leaving the verdict on this matter in doubt.
4. Mayo's perspective was heavily influenced by his work in medicine and
psychopathology and by the theories of several important psychologists,
sociologists, and businessmen. Inspired by the writings of Pierre Janet, a
leading thinker in psychopathology, Mayo concluded that people's work
performance was blocked by various mental obsessions having to do with
problems or maladjustments in their personal or work lives. These obses-
sions, Mayo said, led to "pessimistic reveries" in the workplace and un-
desirable behaviors, such as disobedience, low work effort, and hostility.
Another important influence on Mayo was the French sociologist Emile
Durkheim and his concept of anomie. Mayo thought many workplace
problems were caused by this condition of rootlessness and disorientation
because it destroyed the worker's sense of self and place in society and
thereby the basis for effective cooperation. The Italian sociologist Vilfredo
Pareto was influential in the development of Mayo's idea of the factory as
a social system and of the managerial elite as the guiding force for the
promotion of social order and integration in the plant. Finally, business
executive Chester Barnard, author of The Functions of the Executive ( 1938),

221
 Notes to pages 79-80

impressed Mayo with his ideas about business leadership, particularly the
idea of leadership through consent rather than command.
Mayo was particularly critical of economists and their promotion of
individualism and competition, for, in his view, these forces destroyed the
sense of community and social order necessary for effective collaboration
and thereby reduced society to a "rabble." Mayo (1945:59) states: "Eco-
nomic theory in its human aspect is woefully insufficient; indeed it is absurd.
Humanity is not adequately described as a horde of individuals, each ac-
tuated by self-interest, each fighting his neighbor for the scarce material
of survival. Realization that such theories completely falsify the normal
human scene drives us back to the study of particular human situations
[e.g., internal plant studies such as at Hawthorne]."
5. Of all the implications derived from the Hawthorne experiments with
regard to successful management, Mayo considered the most important to
be the use of human relations techniques to foster cooperation and team-
work among workers and supervisors (1945:73): "Here then are the two
topics which deserve the closest attention of all those engaged in admin-
istrative work-the organization of working teams and the free participation
of such teams in the task and purpose of the organization as it directly
affects them in their daily rounds." This theme was echoed twelve years
later by Conrad D. Arensberg and Geoffrey Tootell (1957:312): "They
[the Mayoites] retain the distinction of having demonstrated again and
again the crucial role of teamwork in the creation of work morale and in
the productivity of the workers. They show that morale and output depend,
not on individual incentives alone or directly, but upon the 'informal
organization' of interpersonal relationships and small-group sentiments
within the immediate workforce."
6. Mayo himself had largely neglected the social dimension of the workplace in
his early writings. In an article published in Harper's (1925), for example,
Mayo said (pp. 229-30), "When we talk of social problems we are apt to for-
get that every social problem is ultimately individual." In emphasizing the
individual, Mayo was following the dominant trend among industrial psy-
chologists of the period, which was to seek explanations for differences in hu-
man behavior by searching for variations in individual mental attitudes,
needs, motives, and so on. The emphasis in his later writings on the social di-
mension of work thus represented a significant intellectual conversion.
7. Warner's first academic research work was an anthropological field study
of a primitive tribe in the South Pacific. Acting as a participant-observer,
he recorded the tribe's various social relationships and the economic func-
tion of its various rites, customs, and so forth. Warner was then recruited
to assist in the development of the bank wiring room experiments at Haw-
thorne. Thus, the decision to study the workers as an autonomous social
group and to observe and record their daily routines and patterns of in-
teraction was solidly in the anthropological tradition.

222
 Notes to pages 81-82

This methodological approach to research was subsequently used by other

human relations scholars. But although it provided a comprehensive and
detailed view of plant life, this research methodology was also the source
of much criticism of human relations research for fostering an undue neglect
of the external environment, particularly the impact of changing political
and economic conditions (which could legitimately be ignored on a South
Pacific island). In William Foote Whyte's study of labor-management con·
flict in a steel plant over the period 1937-50, for example, Whyte states
(1951b:221) that "it has been possible to tell the story of that plant almost
as if it were a completely independent unit." This statement was almost
literally true since at only three points in the book did he make reference
to any exogenous influences on the plant's internal social system. Likewise,
in The Human Group (1950), Homans identifies three external environ·
mental influences on group behavior-social, technical, and physical (p.
88)-but gives no consideration whatsoever to either economic or legal
conditions.
8. Argyris (1954) conducted a thorough review of the human relations re-
search then under way at twenty different research centers or departments
(ten of which were IR institutes) in the United States. He concluded that
human relations research focused on three issues: the nature of the orga-
nization, the determinants of an individual's behavior in an organization,
and managing and integrating the individual's behavior so as to enhance
organizational effectiveness. For each of these three topics he found there
were multiple theoretical frameworks or research methodologies in use. In
an earlier review of human relations research, Arensberg (1951) identified
three separate subschools of human relations.
9. From a science-building perspective, personnel management and human
relations were distinctly different fields of study. From a problem-solving
perspective, however, they shared similar views of the causes of labor
problems and of the best approach to obtain improved industrial relations
(i.e., increased efficiency, equity, and personal well-being in the work-
place); hence, their joint inclusion in what I have called the PM school.
As evidence, compare the suggestions for improved industrial relations
given in McGregor and Knickerbocker 1941 with the discussion of the PM
school in chapter 2. They exhibit a high degree of similarity.
10. It is noteworthy that the experiments at the Hawthorne plant were con-
sidered within the domain of industrial relations research even though the
plant was nonunion and the experiments involved no aspect of union-
management relations. George Pennock, assistant plant superintendant at
Hawthorne, published an article (Pennock 1930) describing the results of
the relay assembly experiments. In the first sentence of the article, he states
(p. 296), "If there is to be a science of industrial relations, there must be
a scientific approach by individuals to the problems of industrial relations."
Likewise, the Personnel journal described Management and the Worker as

223
 Notes to pages 83-84

"the most outstanding study of industrial relations that has ever been
published anywhere, anytime" (Miller and Form 1951:4).
11. My claim is that the majority of academics engaged in human relations
research regarded their investigations as falling under the intellectual
umbrella of industrial relations, just as was true of labor economists. The
identification with industrial relations weakened, however, the further
the person's research interests were from the subject of employer-employee
interactions. Thus, researchers such as Kurt Lewin and Rensis Likert in
the PM school, who were primarily interested in the psychological and
administrative aspects of management, saw little intellectual kinship with
industrial relations, while others such as Chris Argyris and George Ho-
mans saw a modest connection (Argyris, for example, was a member of
the executive board of the IRRA), while still others such as Benjamin
Selekman and William Foote Whyte saw a substantial connection. The
same was true of economists, although in this case the connection with
industrial relations weakened as one moved closer to the neoclassical
school. Clark Kerr and Richard Lester, for example, were closely affiliated
with industrial relations, while Melvin Reder and H. Gregg Lewis saw
only a modest connection (as told to me by Lewis in telephone con-
versation) and Milton Friedman most likely saw none at all (although
he did write articles in the 1950s on labor). Finally, to say that persons
such as Homans and Kerr both perceived themselves to be members of
the field of industrial relations suggests no more than that they possessed
a common interest in employer-employee relations. Their specific research
interests and disciplinary perspectives (sociology and economics) were
quite distinct.
12. Blum briefly discussed the concept of a labor market and stated that
(1925:128) "of all markets the labor market is the poorest [i.e., least
efficient in operation)." He later states (pp. 372-73): "Under competitive
conditions, the demand of the buying public for cheaper goods ... forces
a cut-throat competition and breaking down of wage rates that finally
reaches an extreme, but logical conclusion in the sweatshop" and "the
trade union is a group united to protect a common interest ... [and] has
been forced by the weakness of the individual bargainer. Large scale in-
dustry, concentration of capital and reduction of skill have reduced the
isolated workman to an insignificant unit in the full scheme of production,
but has increased enormously the power, influence and resources of the
large employer."
13. Indicative of this is Witte's comment (1954: 131) that "I shifted to eco-
nomics from history because my major professor, Frederick Jackson Turner,
... left Wisconsin and told me that the best historian among many good
historians on our campus was John R. Commons, although he was attached
to the economics department." Commons was also well versed in sociology
and anthropology, in part because those fields were housed in the economics
department at Wisconsin until 1929 and he was chairman of that depart-

224
 Notes to page 85

ment. Anthropology also had a particularly marked impact on the writings

of fellow-institutionalist Thorstein Veblen (Dorfman 1959).
Mayo and the other members of the human relations movement rarely
acknowledged the work of the institutional economists, although the two
research programs heavily overlapped. Commons, Hoxie, and Slichter, for
example, had all written on the problem of restriction of output and had
noted how workers used group sanctions to control production levels (see
Commons 1919; Hoxie 1915; Slichter 1919b), yet Mayo (1933) and Roeth-
lisberger and Dickson ( 1939) wrote about the phenomenon as if it were a
new discovery. (The Harvard group also neglected an influential book on
the subject of output restriction by Stanley Mathewson [1931], an engi-
neer.) With regard to research methods, Mayo (1945) argued that re-
searchers should first use clinical interview techniques to discover workers'
perceptions and attitudes before embarking on theory development and
hypothesis-testing, a position similar to that of the institutionalists, who
advocated that researchers develop theories only after an intensive gath-
ering of facts through the case study "go and see" approach. Finally, the
emphasis given by the human relationists to the important effect that
informal work groups, workplace custom, and social relationships have on
the operation of firms and level of production was exactly the type of
collective influence that Commons sought to make the core subject area
of institutional economics. Landsberger (1958:89) notes this connection
when he says of Management and the Worker that "the book contains the
psychological underpinnings of an institutional analysis, whether sociolog-
ical or economic."
14. Commons's Institutional Economics (1934b) is extremely difficult reading,
as Commons acknowledges on page one, where he states that reviewers of
earlier drafts of the book told him they "could not understand my theories
nor what I was driving at, and that my theories were so personal to myself
that perhaps nobody could understand them." A critical appraisal of Com-
mons's theoretical works is provided by Coats (1983); for a more favorable
interpretation, see Harter (1962) and Chamberlain (1963).
15. The major exception to this statement is the work of Paul Douglas, a labor
economist at the University of Chicago. Douglas had a foot in both the
neoclassical and the institutional camps, for, on the one hand, he was a
first-rate theorist and statistician (he co-invented the Cobb-Douglas pro-
duction function and co-authored the first study that estimated a labor
supply function), while, on the other, he was a knowledgeable authority
on management and personnel subjects, placed considerable emphasis in
his writings on the imperfect nature of labor markets, and, for that reason,
supported trade unions and protective labor legislation. In addition to
Douglas, Sumner Slichter of Harvard and Harry Millis of Chicago also
deserve mention, for although their writings in labor were more institu-
tional in nature, they had a clear command of economic theory (see Slichter
1931).

225
 Notes to page 85

16. Another young economist who took up the study of labor in the early
1940s was H. Gregg Lewis. Lewis did his doctoral work at Chicago in the
late 1930s under Paul Douglas and, upon graduation, was appointed to a
faculty position. Lewis's name is not included in the list of prominent labor
economists cited here because his research had relatively little impact on
the field until the publication of his book on unions and relative wages
(Lewis 1963). Lewis had a significant but more indirect impact on the field
in earlier years through his influence on graduate students at Chicago, such
as Albert Rees and Gary Becker.
Lewis has been called the father of "modem" or "analytical" labor eco-
nomics (see Rees 1976; American Economic Review, September 1982, fron-
tispiece). I believe a more correct title is father of the Chicago school of
labor economics or, what is essentially the same thing, the neoclassical
revival in American labor economics. As I have argued elsewhere (Kaufman
1988: 197), Lewis can be considered the father of analytical or modem labor
economics only if these terms are interpreted narrowly to mean the thor-
ough application of competitive price theory to labor markets and, more
particularly, the testing of hypotheses through rigorous statistical analyses.
If modem and analytical are interpreted more broadly to mean the analysis
of the operation of labor markets and the determinants of labor demand
and supply, then Paul Douglas deserves to be listed as the progenitor of
the field and economists such as Dunlop, Kerr, Lester, and Reynolds as
the "fathers."
17. The clearest dividing line between the labor problems and labor markets
approach to labor economics is provided by Richard Lester's text Economics
of Labor (1941 ). Three features of the book distinguish it from earlier labor
problems texts: its focus on labor markets rather than labor problems per
se, the important role it gives to the determination oflabor market outcomes
by demand and supply conditions, and the use of analytical techniques
such as graphical representation of demand and/or supply curves. The text
also represents an interesting middle ground between the institutionalism
of Commons and the neoclassical economics of Hicks. Lester clearly follows
Hicks and the neoclassical approach to labor economics in that he focuses
attention on the operation of labor markets and demand and supply, but
he clearly follows the institutional perspective in the amount of attention
given to the imperfect nature of labor markets and in the relatively favorable
treatment of unions and protective labor legislation.
18. A recurrent debate concerns the appropriate label to attach to these labor
economists and, in particular, whether they are an offshoot of the neo-
classical or the institutional school (see Kaufman 1988). Glen Cain (1976),
for example, has labeled them neoinstitutionalists on the grounds that,
like the earlier institutionalists, they largely rejected competitive neoclassi-
cal theory as a useful tool to understand the behavior of labor markets;
desired to incorporate into economic theory a more behavioral model of
man, models of imperfect competition, and the influence of organizational

226
 Notes to page 85

factors (rules, social relations, company policies); and were advocates of

economic pluralism and, in particular, collective bargaining. Kerr (1988)
argues that the neoinstitutional label is inaccurate and that "neoclassical
revisionists" would be a better term. His rationale is that these economists
saw themselves as the lineal descendants of Marshall, not Commons, made
the focus of their research the operation of labor markets and used demand
and supply theory to study these markets, and desired to reform economic
theory to make it more realistic rather than replace it outright as the
institutionalists allegedly did.
I have avoided using these labels given the lack of consensus as to which
is appropriate. My own view is that these economists started their careers
as neoclassical reformers but gradually shifted over time and by the late
1950s were for all intents and purposes neoinstitutionalists. For example,
other labor economists of the 1950s regarded them as members of the
institutional school (e.g., McConnell1955; Ferguson 1965). Further, they
made frequent use of theoretical concepts or ideas analogous to those
developed by Commons, such as working rules (Kerr and Siegel 1955;
Dunlop 1958), reasonable value (Lester 1973), pluralism (Kerr 1954b),
and the imperfect nature of labor markets (Kerr 1950; Lester 1951; L.
Reynolds 1951). Finally, they attempted to infuse economic analysis with
insights from other disciplines. Regarding the book Industrialism and In-
dustrial Man (Kerr et al. 1960), for example, James L. Cochrane (1979:141)
states: "The problems of interest to Kerr, Dunlop, Harbison, Myers and
their collaborators were not focused on market phenomena. The orientation
of these writers was to combine economics and sociology .... Thus, while
a body of orthodox, neoclassical theory did exist, the Inter-University Study
represented a portion of the post-World War II generation which chose
to ignore or at least to suppress their enthusiasm for orthodoxy. They
followed in an earlier tradition, but struck out in their own direction."
Another piece of evidence comes from two recent articles by Dunlop
(1984a, 1988) that critique present-day labor economics. Dunlop argues
that neoclassical theory is defective because it omits consideration of the
complex of rules that govern the employment relationship, the pattern of
social relations in the workplace, the existence of noncompeting groups,
and the various institutional forms taken by labor markets. From my point
of view, these suggested reforms are clearly in the institutional tradi-
tion. Dunlop rejects this position, however, arguing instead that current-
day labor economics has been subverted by a small band of imperialistic
Chicago-based microtheorists and that the position he advocates is not
abandonment of neoclassical theory for an institutional alternative but,
rather, a return to its "mainstream" version as represented in the work of
Paul Samuelson, Robert Solow, John Hicks (post-1960), and others. The
issue then becomes whether mainstream economics (so identified) ever
gave much weight in theoretical or empirical work to the omitted factors
Dunlop identified and whether the omission of these factors in modem-

227
 Notes to pages 87-89

day labor economics reflects the intellectual coercion of a minority or the

willing acquiescence of the majority. I suspect the answer is "no" to the
first part and "willing acquiescence" to the second part.
In recent telephone conversations, Richard Lester suggested that a more
accurate term than those discussed above might be "social science labor
economists," while Clark Kerr suggested "Keynesian labor economists."
Both capture an important aspect of these economists' perspectives.
19. Lester (1952:485) expresses this point of view as follows: "An explanation
of the complex phenomena of wage differentials ... clearly involves the
development of a new type of theory. It means hewing out a theoretical
position somewhere between the narrowly based traditional theory and the
all-inclusive confusion of the German historical school or the American
institutionalists." He goes on to say that the theory should allow for multiple
motivations on the part of managers and workers and include an interdis-
ciplinary blend of economic, psychological, political, social, and institu-
tional factors.
20. Kerr and Dunlop exemplify this dual set of interests. Kerr received his
formal training in economics from teachers such as Abba Lerner and Oscar
Lange, both theorists, and read Hicks's Theory of Wages, not Blum's Eco-
nomics of Labor. His first research project, however, was an investigation
of a cotton pickers' strike (Kerr 1988). Dunlop, in tum, had the best
analytical skills of any of the new generation of labor economists of this
period and published several influential articles and books on various aspects
of economic theory (e.g., bargaining models, models of union wage de-
termination, labor supply and demand functions). At the same time, he
was involved at the highest levels of government and industry in the
resolution of labor disputes and the administration of wage-price control
programs (Dunlop 1984b). This duality in their careers reflects, I hypoth-
esize, their interest in both the practice of science-building and problem-
solving and, hence, the study of labor economics and industrial relations.
21. A review of the research of Dunlop, Kerr, Lester, and Reynolds reveals
that before the mid-1950s the majority of their publications were on some
aspect of the operation of labor markets or the impact of unions on the
labor market, while after this period their research interests shifted toward
labor-management relations, the function, structure, and evolution of
unions, and the role of labor in industrialization (see Kaufman 1988:233-
44). From 1954 onward, Dunlop and Kerr, for example, devoted much of
their attention to the completion of their Ford Foundation project, the
Inter-University Study of Labor Problems and Economic Development, out
of which was published Industrialism and Industrial Man (Kerr et al. 1960)
and Industrial Relations Systems (Dunlop 1958). Also of note in this regard,
the professional association these economists were most actively involved
in was the IRRA, not the AEA. If polled today, I suspect that most labor
economists would identify industrial relations, not labor economics, as their
principal field of research.

228
 Notes to pages 89-90

22. Another event that is suggestive of the gap between the theorists and the
ILE-oriented labor economists was the publication of The Impact of the
Union (Wright 1951). The book contained a series of articles by eight
prominent economic theorists and a round-table discussion by these men
on the impact of labor unions on wages, employment, inflation, and other
such market outcomes. No labor economist was invited to contribute to
the volume, leading Lloyd Reynolds (1953:474) to observe, "This volume
seems to have developed from a feeling that-to paraphrase a famous
remark about generals-that labor economics is too important to be left
to the labor economists." Another piece of evidence in this regard comes
from a biography of the institutional economist Edwin Witte. Theron F.
Schlabach (1969:224) states that "Witte's feeling of alienation from his
profession approached its peak in the late 1940s" and that Witte complained
that identifying himself as an institutionalist was "equivalent to admitting
that I am not an economist at all."
23. The different perspectives of the two groups of economists regarding unions
is clearly revealed in the debate over the "labor monopoly" issue. See, for
example, Lester 1947b and Lewis 1951.
24. The most detailed discussion of the goals and objectives of the founders of
the IRRA is contained in an article by Clark Kerr ( 1983) commemorating
the thirty-sixth anniversary of the founding of the association. That the
IRRA was founded as an act of rebellion in economics and that its dominant
goal was to provide an organizational home for more institutionally oriented
labor economists and their soulmates from other disciplines are clearly
revealed in his article (p. 14): "We [the young labor economists] started
out as rebels. We first met almost like conspirators in the hallways during
the annual meetings of the American Economic Association to grumble
about what then seemed to us to be the neglect of labor economics at these
meetings .... It seemed to us then almost incredible ... that labor ... was
so ignored as compared, for example, with the role of capital; that the firm
was the source of so much attention and the union hardly mentioned; that
labor markets, when noticed at all, were viewed as though they were
commodity markets; that collective bargaining, then in the daily headlines,
had not penetrated into the domain of the interests of most traditional
economists; but, most of all, that theory seemed to move along at the
microeconomy level with so little contact with reality."
Kerr goes on to describe the goals of the founders of the association (p.
15): "We had several goals in mind when we founded the association. First
of all, we wanted to meet together, to get to know each other better, to
find out what others of us were doing, and this was not possible in the
crowded mass atmosphere of the American Economic Association. Second,
we wished to have an impact on the programming of the Association ...
[and to call the attention of] the theorists to our field of interest and to
our own research. Third, we wanted to create a forum which would be
participated in by practitioners in the unions, in industry, and in govern-

229
 Notes to page 92

ment who would never feel at home and would consequently never come
to meetings of the American Economic Association .... We had a fourth
goal which was to bring in scholars from related social sciences, particularly
law, sociology, political science, and psychology, to discuss matters which
clearly transcended the traditional boundaries of economics."
It seems clear from these remarks that the IRRA was born out of dual
motives. The purported motive was to foster the study of the employment
relationship from all disciplinary and ideological perspectives (as stated in
the IRRA constitution). The second motive, and the one that clearly was
the more salient to Kerr and the other founders of the organization, was
to provide a forum for labor economists who wanted to pursue a more
institutionally oriented, interdisciplinary mode of research than was wel-
comed in the American Economic Association. In hindsight, it would have
been better for the founders of the IRRA to pursue one objective or the
other but not both. If the IRRA was to promote industrial relations, it
should have had a wider disciplinary and ideological representation and
most certainly would not have been centered in economics given that
economics was the disciplinary base of the ILE school. (Kerr [1983: 17]
suggests that sociology might have been a better disciplinary base for in-
dustrial relations, a suggestion with considerable merit, given that sociology
seemed to be centered on the disciplinary fault line that separated the PM
and the ILE schools.) If the IRRA was instead to be devoted to the prop-
agation of a more institutionally oriented brand of labor economics, it
would have been preferable to state this as its mission, to give the orga-
nization an appropriate name, and to pursue this objective explicitly in
the organization's programs and publications. (Yoder [1958:3] states that
the original name selected for the IRRA was the American Association
for Labor Research, which would have better conveyed the second objec-
tive). As it is, the IRRA has been too timid in its pursuit of rebellion in
labor economics, and, worse, it has corrupted the original meaning and
spirit of the term industrial relations by its refusal to give equal representation
to the members and viewpoints of the PM school.
25. The active participation of behavioral scientists in industrial relations is
illustrated by the titles of several books: The Sociology of Industrial Relations
(Knox 1955), Industrial Relations and the Social Order (Moore 1951), and
Psychology of Industrial Relations (Lawshe et al. 1953).
26. In the 1940s-50s, most industrial relations research was done by academics,
unlike earlier periods, when businessmen, union officials, and consultants
authored a significant share of the literature. Exceptions in the latter period
include works by Clinton Golden and Harold Ruttenberg (1942) and by
Solomon Barkin (1950, 1957), all of whom were union officials, and by
Robert Johnson (1949) and Carter Nyman (1949), who were business
executives.
27. Wilensky was apparently unaware of the earlier map of industrial relations
that had been prepared by the Social Science Research Council in 1928

230
 Notes to pages 94-99

(see fig. 1-1), for he makes no mention of it. The major differences between
the maps are that Wilensky omitted some of the fringe fields of study (e. g. ,
physiology, chemistry, education) that were included in the earlier survey
and provided a much more in-depth treatment of the research literature.
The maps are similar in that both define industrial relations quite expan-
sively to include all manner of relations in the workplace (e.g., vertical
"man-boss" relations within a company, horizontal relations between work-
ers and work groups in a plant or workshop, relations between workers and
labor organizations, and relations between organizations such as unions and
firms) and a broad range of disciplines and fields of study across the be-
havioral and social sciences.
28. According to Strauss (1979:371), "The project was widely viewed as a
failure; it is rarely cited ... [and] appears to have had little influence on
other research."
29. Derber (1968) found that international studies comprised 17.3 percent of
the research projects conducted at fifteen IR centers during 1956-59. Of
the fourteen subject areas Derber surveyed, management organization and
communication was the most researched topic (18.6 percent), followed by
international IR.
30. A thorough review of the origins and development of the Inter-University
Study project, as well as an assessment of the strengths and weaknesses of
the book Industrialism and Industrial Man, is given in Cochrane 1979. A
retrospective look at the conclusions by the four authors is contained in
Dunlop et al. 1975.
31. Empirical evidence in support of Dunlop's position was provided in a study
by Kerr and Siegel (1954) on the propensity to strike across industries.
They demonstrated that certain industries such as coal and longshoring are
strike-prone in nearly every industrial country. They argued that this pat-
tern reflected common environmental characteristics of these industries
(e.g., the dangerous nature of the work) rather than plant-specific human
relations practices.
32. The extent and degree of the anti-union bias in human relations is a matter
of considerable debate (see Landsberger 1958). Mayo certainly seemed
ambivalent about unions and suggested that they often played an undesir-
able role by interfering with the development of "spontaneous collabora-
tion" in the plant. Later human relations writers took some pains, however,
to accord unions legitimacy in the conceptual model of human relations
and its normative prescriptions for practice and policy. Whyte (1951b),
for example, argued that the union was an integral part of the social system
in the steel plant he studied, while Homans (1954:57) allowed that "if
unions did not exist, we should have to invent them .... We must not
only accept the fact that unions are here to stay but accept the idea that
they need to stay."
These concessions did not allay the fears of the critics, however (see
Kerr and Fisher 1957). As they saw it, the emphasis on cooperation and

231
 Notes to page 99

enlightened management was anti-union in both theory and practice. In

terms of theory, human relations seemed to deny the cardinal principles
of the ILE school-the unavoidable element of adversarialism in the re-
lations between workers and managers, management's inherent power ad-
vantage vis-a-vis workers and the limited checks posed on the opportunistic
exercise of this power by economic and legal forces, the inevitability of
worker-management conflict and the social utility of such conflict, and the
desirability of pluralism in the nation's economy and political system. In
terms of practice, many of the critics viewed collective bargaining as a net
social and economic plus and favored it as the principal means of workplace
governance. From their point of view, the bottom-line effect of human
relations was to reduce workers' interest in union representation, a goal
that was inimical to the long-term interests of workers and society at large.
In effect, then, the proponents of the ILE school saw the human relations
group as wolves in sheep's clothing on the subject of unionism and for that
reason remained hostile to them.
George Strauss (1992) expresses his view on this subject in an autobio-
graphical article: (p. 20): "As late as 1989, in a discussion of the role of
human resources management in the Industrial Relations Research Asso-
ciation, John Dunlop insisted on calling HRM, 'human relations,' which,
as he saw it, was just another method of union busting. These attacks still
sting. As someone studying human relations in unions I felt it grossly unfair
to charge human relations with being anti-union. Quite the contrary. My
1948 McGregor class notes make it clear that he viewed human relations
without unions as a sham.... Mayo, it is true, might be viewed as pater-
nalistic and even a bit fascistic. Roethlisberger hoped that management
would work so well that unions weren't necessary. But for him unions were
merely the bearer of bad news."
Finally, it is worth nothing that while a number of the academic members
of the PM school were either neutral or favorable toward unions, the same
was definitely not true among practitioners. Chapter 3 documented that
in the 1930s a large proportion of the writers on industrial relations subjects
in the PM school were practitioners and consultants. As long as trade
unions were only a minor threat, as in the early part of the 1930s, these
writers felt comfortable with their affiliation with industrial relations and
largely soft-pedaled their antipathy to unions. Passage of the Wagner Act
in 1935 and the dramatic growth in union membership in the late 1930s
quickly changed the situation, however. Not only did their attacks on trade
unionism and the nation's labor policy become more overt and critical,
but their sympathies with, and allegiance to, the field of industrial relations
also noticeably weakened (see Spates 1944). The result was that the prac-
titioner wing of the PM school largely divorced itself from industrial re-
lations five to ten years earlier than the academic wing.
33. The experience of Chris Argyris is illustrative. He received his Ph.D. in
industrial relations in 1951 from Cornell University. His major research

232
 Notes to page 99

interest was human relations, and his doctoral training was primarily in
social psychology, clinical psychology, and sociology. He stated in a tele-
phone interview that in the early 1950s he felt a strong sense of affiliation
with industrial relations and perceived that human relations research was
an integral part of the field. Participation in industrial relations was at-
tractive, Argyris said, because it provided an opportunity to integrate the
social and psychological research of human relations with the economics
and institutional research of the ILE school. He discovered, however, that
the majority of economists were not interested in such an integration.
In the early 1950s, the IRRA and the Social Science Research Council
asked Argyris to conduct a survey of human relations research at major
American universities. In 1954, he presented his findings at a meeting of
the council (see Argyris 1954). He said that, while some ILE participants
expressed genuine interest in human relations research, his perception was
that the attitude of the majority ranged from indifference to hostility. Given
such an attitude, he largely ceased active involvement in industrial relations
by the late 1950s. Argyris cited several reasons the majority of economists
were unreceptive to human relations research: it was perceived as a threat
to unions and collective bargaining, was regarded as too "soft" (unscien-
tific), and was seen as a tool to manipulate workers.
34. An example is provided by Kerr and Fisher (1957:282): "This group of
sociologists has grown steadily in size and influence during the past few
years, bringing with it certain charges against the intellectual apparatus
with which the economists have worked. For those with a sense of history
of ideas, there is a haunting familiarity to the charges. For they are the
charges levelled by the church and aristocracy against the abstract, indi-
vidualistic conception of the philosophes; they are the charges levelled by
Burke against the French Revolution in the name of the prior rights of
society and the group as against those of the artificial conception of rea-
soning man, by the German romantics of the 19th century in the name
of the greater reality of the folk, by the Nazis against 'liberalism,' and by
the Communists against cosmopolitanism.... This is the most modem
episode in the attack on reason in the name of harmony, cohesion, and a
traditional culture."
35. The selection of William Foote Whyte as IRRA president in 1963 would
appear to contradict this claim, given Whyte's status as the leading ex-
ponent of the human relations school in industrial relations. By 1963,
however, the battle between the ILE and PM wings over human relations
was effectively over and the human relations group was well into the process
of divorcing itself from industrial relations. My perception, therefore, is
that by 1963 Whyte was a politically "safe" candidate because the human
relations movement no longer posed an effective challenge to the ILE
hegemony of the field, whereas a decade earlier Whyte's selection would
have potentially opened the door to a true sharing of political power and
intellectual perspectives. (This interpretation is supported by Whyte, who

233
 Notes to pages 99-101

said in a telephone conversation that he was surprised to learn that he had

been selected as president, had largely ceased being actively involved in
the organization by the early 1960s, and thought his selection was motivated
by a desire on the part of the IRRA to honor his past work and accom-
plishments in the field and demonstrate a belated sense of ecumenicism.)
Other members of the PM school might have been selected as president
in the 1950s-early 1960s had the IRRA been truly committed to the
inclusion of a variety of viewpoints and disciplines. Examples include Doug-
las McGregor, former director of the Industrial Relations Section at MIT
and author of the influential book The Human Side of Enterprise (1960);
Chris Argyris, research director at the Yale Labor-Management Center and
author of the much cited book Personality and Organization (1957); and
Robert Dubin, a sociologist who had written numerous articles and books
on industrial relations topics. The one person chosen during the 1950s to
be IRRA president who did have close links to the human relations school
was E. Wight Bakke. It is probably not coincidental that of all the people
writing on human relations topics Bakke had the closest association with
both the discipline of economics and the ILE wing of the IRRA (as evi-
denced, for example, by the book Unions, Management, and the Public
[1948], co-edited by Bakke, Clark Kerr, and Charles Anrod).
36. The concept of a "web of rules" and the importance of these rules for
structuring the system of industrial relations (the ILE portion) was first
developed by Kerr and Siegel (1955).
37. It is ironic in this regard that Dunlop drew much of the inspiration for his
systems model from the work of sociologist Talcott Parsons (see the ap-
pendix to chapter I of Industrial Relations Systems), who, in tum, was heavily
influenced by Vilfredo Pareto, whose writings inspired Elton Mayo to con-
ceptualize the factory as a self-contained social system.
38. Dunlop, in a telephone interview, expanded on his position. He perceived
that in the 1950s, industrial relations (the ILE portion) was composed of
a set of interrelated intellectual concepts that made it worthy of scientific
inquiry, but that human relations was devoted largely to the development
and application of managerial "tools" for practitioners and thus had little
intellectual interest per se. He still maintains that the substantive aspects
of the employment relationship are principally determined by conditions
external to the organization (see Dunlop 1993). And he believes that the
rules of the workplace (where rules are broadly defined to include both
formal and informal conventions, standards, and policies) encompass the
aspect of the employment relationship that is most amenable to scientific
investigation. Thus, Dunlop did not accept Myers's compromise because
the variation in the dependent variable Myers was trying to explain (the
tenor of labor-management relations) is not, in Dunlop's opinion, one that
any theory can ever say much about.
39. Further support of this interpretation comes from an earlier article by
Dunlop (1954:92) in which he states, "This paper [a survey of research in

234
 Notes to page 102

industrial relations] considers the locus of industrial relations to be union

and management organizations and their interactions at all levels." The
only precedent for this narrow labor-management definition of industrial
relations I can find in the pre-World War II literature is an article by Leo
Wolman in the 1932 edition (7:710-17) of the Encyclopedia of the Social
Sciences. Wolman's discussion of the field of industrial relations is focused
almost entirely on developments in the labor movement and union-
management relations. One possible reason for this restricted view is that
Wolman was research director for the Amalgamated Clothing Workers'
Union until 1931.
Fiorito (1990) and Meltz (1991) strongly dispute the claim made here
that the theoretical model contained in Industrial Relations Systems unduly
neglects the role of management, the nonunion sector, and behavioral
aspects of employment relations. I believe their arguments are unconvinc-
ing, however. Fiorito claims, for example, that the real (his emphasis) IR
systems model factors in all the considerations cited above, yet his citation
to this "real" model is not Dunlop's book but unpublished lecture notes
from a class taught by Milton Derber. Dunlop's book must be judged on
its own merits, however, and not someone else's classroom interpretation.
Likewise, Meltz argues that it is difficult to understand charges that Dunlop
neglected behavioral aspects of employment relations when he explicitly
distinguishes between formal and informal rules. But nowhere in the book
are these informal rules (or the informal work groups that often devise
these rules) discussed in any substantive way.
40. Dunlop gives considerable emphasis to the interactions between unions
and companies as organizations but pays very little attention to such topics
as the reasons workers are motivated to join unions and the conditions
that determine a union's policies and practices regarding bargaining de-
mands, structure, and strategy. In this respect his perspective on industrial
relations research is even narrower than that of the ILE school.
Dunlop's omission of the "internal" dimension is consistent, however,
with the position he had taken in two earlier academic debates. The first
was with Arthur Ross and centered on Dunlop's ( 1944) "economic" model
of trade unions and on Ross's (1948) "political" model. Ross gave consid-
erable emphasis in his book to the role of union leaders and social and
psychological factors (e.g., "orbits of coercive comparison") in the deter-
mination of union wage policy. Dunlop claimed this position overem-
phasized the internal organizational dynamics of unions and neglected the
impact of the external economic environment. The second debate was with
William Foote Whyte (see Dunlop 1950; Whyte 1950) over the pros and
cons of the human relations framework for IR research. This framework,
as noted earlier, emphasizes that much collective behavior has social or
psychological origins (e.g., desire for affiliation in a social group, devel-
opment of group norms and sanctions to protect the collective welfare of
the group) rather than economic origins, a position Dunlop heavily crit-

235
 Notes to page 103

icized. His stance on this matter made it difficult for him to include within
his theoretical model in Industrial Relations Systems topics such as union-
joining since much of the literature on this subject tended to emphasize
the social and psychological motives discussed in the human relations
literature (see, for example, Hoxie 1917, Tannenbaum 1921, and Leiserson
1959:16-31).
Since Dunlop had unsurpassed familiarity with the internal workings of
both firms and unions, it is clear beyond a doubt that he was cognizant of
the internal organizational dimension as a practical matter. That he omitted
it from his theory has to be interpreted as reflecting his perception that
internal organizational, psychological, and sociological factors play a rel-
atively minor role in the operation of the industrial relations system (as
stated in his 1950 article). This is an entirely acceptable position, but it
would have been better if he had explicitly discussed this proposition in
the book and provided empirical support for it, rather than adopt it as an
unstated assumption. There is some evidence that Dunlop's position may
have softened over the years, for in an article published in 1988 he discusses
at length the important role played in wage determination by the informal
social organization in the plant and cites a book by Elton Mayo as evidence.

6. THE HOLLOWING OUT OF INDUSTRIAL RELATIONS

1. The first editor of the journal was Arthur Ross. He briefly discussed the
reasons for establishing it and its intended purpose in a note at the beginning
of the first issue (Ross 1961). Three themes therein deserve mention. First,
Ross framed the intellectual domain of industrial relations quite broadly
to include all aspects of the employment relationship (see the statement
to this effect on the inside cover of each issue). Second, the motivation
for establishing the journal was clearly problem-solving, not science-
building per se. Thus, Ross (p. 5) states: "The heart of the matter [the
reasons for founding the journal] is that economic and political changes
have undermined a great deal of what seemed reasonably well established
in industrial relations in 1940 or 1950. A whole new set of issues have
been created ... [and] we desire to participate in the examination of these
new issues and the search for solutions." Third, as evident in the quotation,
Ross perceived that the problems most in need of examination in industrial
relations had changed considerably relative to ten to twenty years earlier.
He listed four specific issues as meriting attention: technological change,
the effects of increased competition in product markets, the increased
demand of workers and their families for economic security and the basic
necessities and amenities of life, and the altered values and attitudes toward
work among young people and white-collar workers.
Clark Kerr, then president of the University of California system,
played an instrumental part in getting the journal started. In a telephone
conversation, he related that part of the purpose of the journal was to
chart a new direction for industrial relations that would largely parallel

236
 Notes to pages 113-17

the path taken by the book Industrialism and Industrial Man (Kerr et al.
1960). Thus, .the intent was to move away from the preoccupation with
unions and labor-management relations that had characterized IR research
in the 1950s toward a dynamic, comparative analysis of the evolution
of industrial society, its major institutions, and the manner in which
work is organized and performed. He thought that, although the journal
has been quite successful in its own right, it has largely failed in guiding
IR research along this new path. As will become clear, the principal
reason for this failure is that the trend toward pure science-building
research in academia was incompatible with the research agenda mapped
out by Kerr and his colleagues.
2. The narrowing of the subject domain of IR after 1960 complicates use of
the term industrial relations in this and subsequent chapters since it is no
longer clear whether the term applies to IR broadly conceived (all aspects
of the employment relationship) or to IR narrowly conceived (labor-
management relations). From 1960 onward, most academics and practi-
tioners used industrial relations in its narrow sense, a convention that I
follow from here on (unless the broad interpretation is clearly implied or
is specifically stated).
3. Representative of this point of view is the statement by Wilensky in his
Syllabus of Industrial Relations (1954:6) that "few students identified with
the field confine it to union-management or employee relations."
4. A small number of articles did not fit into any of these topical areas and
were thus excluded from the calculations.
5. I mentioned earlier (note 1) that the founders of Industrial Relations intended
it to include research on all aspects of the employment relationship. The
data cited here suggest that the journal had modest success in the 1960s
in this regard (and certainly more so than the ILR Review) but that during
the 1970s it lost a considerable degree of its disciplinary and topical
eclecticism.
6. It is my perception that behavioral research on even narrowly defined IR
topics (e.g., subjects pertaining to unions and labor-management relations)
declined during the 1960s and 1970s. The increasing percentage of papers
published in the IRjournals by economists (as documented earlier) certainly
supports this position. Since the late 1970s, however, a modest rebirth of
interest in behavioral research has occurred in industrial relations. That
IR is still conceived narrowly in this research is suggested by yet another
symposium on the subject, this one published in the winter 1988 issue of
Industrial Relations. Five of the seven papers focused on a collective bar-
gaining subject.
7. This statement was affirmed by William Form in a telephone interview.
When the first edition of the book was written, industrial sociology did
not exist as a distinct field of study. Hence, he and Delbert Miller sought
to take various strands of largely unconnected research on labor (e.g.,
social stratification, sociometry, organization theory, human relations) and

237
 Notes to pages 117-20

provide an intellectual structure for them. These strands of research were

all part of industrial relations, they believed, and thus figure 3-1 was
developed to illustrate these interrelationships. By the early 1960s, Form
said, figure 3-1 no longer accurately described industrial relations, and the
relationship of industrial sociology to it, and was thus dropped.
8. Historically, the institutionalists had given great attention to the role of
protective labor legislation and social insurance programs as methods to
resolve labor problems, a fact reflected in the presence of courses and even
majors in IR curricula on topics such as Social Security, unemployment
compensation, and workers' compensation, as well as the numerous sessions
devoted to them at early IRRA meetings. After 1960, however, interest
in these subjects among IR academics waned considerably, leaving the field
even more narrowly constituted than its ILE version of the 1950s. Partially
offsetting this trend, however, was the increased attention given at IRRA
meetings, if not in IR curricula, to the labor market problems of disad-
vantaged groups such as minorities and the poverty-stricken. The early
institutionalists had largely neglected these topics.
9. According to Hilde Behrend ( 1963) and John Berridge and John Goodman
(1988), a debate over the broad versus the narrow definition of industrial
relations also took place among British academics. One view that received
support from several prominent scholars (e.g., Hugh Clegg, Allan Flanders,
George Bain) was that industrial relations was the "study of job regulation,"
a definition that included union and nonunion work situations in principle
but in effect narrowed the field to the study of union situations only.
10. William Form, in a telephone interview, cited several reasons sociologists
largely ceased active participation in industrial relations. The most im-
portant reason, he believed, was the growing preoccupation of sociologists
with issues of theory and methodology (i.e., science-building), a trend that
caused research to become more inward-looking. Another factor was that
the structuralists, who had dominated sociology, were gradually supplanted
by social psychologists. The structuralists placed great emphasis on collec-
tive action and institutions, while the psychologists emphasized determi-
nants of individual behavior. Finally, many sociologists took a Marxist or
radical perspective on labor issues, which was incompatible with the more
conservative, pluralistic ideology in industrial relations. Although sociology
and industrial relations largely went separate ways in the 1960s and 1970s,
according to Form, in the 1980s a modest rekindling of interest in IR topics
occurred among sociologists.
11. An extensive bibliography of behavioral science research on unions and
collective bargaining is contained in Lewin and Feuille 1983 and in in-
dividual chapters of Strauss, Gallagher, and Fiorito 1991. The latter is a
good example of the revival of behavioral research in industrial relations
(narrowly defined).
12. The absorption of human relations into organizational behavior was facil-
itated by the disrepute that the former had fallen into by the late 1950s,

238
 Notes to pages 121-22

due in part to theoretical deficiencies and in part to disillusionment in

response to the excessive claims of its adherents to the effectivene~s of such
applied human relations techniques as T -groups and supervisor training.
As Strauss (1970:145) said: "For many managers human relations was
stereotyped, not as a field of study, but as a namby-pamby, be-good approach
to management. Those who looked upon their fields as research-oriented
science, rather than a set of preachy values, began to search for a new
name and approach."
13. Personnel Psychology was established in 1948 to promote research on the
application of pscyhological principles to personnel management. Although
it was arguably the most research-oriented of the personnel journals, only
one-fourth of the members of its editorial board were academics and the
articles were relatively narrow in focus and practitioner-oriented. Typical
of these articles were several in the first issue, including "Vision Tests for
Precision Workers at RCA," "Interest Tests Reduce Factory Turnover,"
"Testing Programs Draw Better Applicants," and "An Attitude Survey in
a Typical Manufacturing Plant."
14. Several "humanistic" theories of motivation (e.g., Maslow's hierarchy of
needs, McGregor's theory X and theory Y) played an important role in the
movement from the human relations to the human resources view of man-
agement. Whereas human relations had stressed improved social conditions
as the principal mechanism to improve employee morale and productivity,
Maslow and McGregor emphasized "self-actualization" (development and
use of one's human potential) on the job. The implication for managerial
practice was that, instead of improving conditions external to the job (e.g.,
communication skills), it was better to improve the job itself and to increase
the opportunities given workers for participation and decision-making
through such means as self-managed work teams and other forms of em-
powerment. This new perspective proved quite compatible with the "in-
vestment in people" idea and quickly became a central part of human
resources theory.
15. The difference in approach between the old and the new generation of
labor economists is clearly revealed in the texts of Lester (1941; 2d. ed.,
rev., 1964), Cartter and Marshall (1967), and Fleisher (1970). Lester's
book is one of the last examples of the institutional or labor problems
approach to the subject, while Fleisher's is one of the first examples of
the market-oriented or neoclassical approach. Cartter and Marshall at-
tempted to bridge the two approaches by devoting half their book to a
demand-supply analysis of labor markets and the other half to a more
descriptive analysis of unions and collective bargaining. A decade later
this approach was obsolete because of the ongoing shift in labor economics
toward competitive theory and formalized model-building. For another
illustration of the cleavage that existed between the neoinstitutional and
neoclassical approaches to the study of labor economics, compare Ross
(1964) and Becker (1976).

239
 Notes to pages 124-34

16. Although the 1950s-era labor economists associated with the ILE school
largely ceased active research in labor economics per se, several continued
to publish in the field of industrial relations. The two most notable examples
were Dunlop and Kerr, who authored articles and books on IR subjects
throughout the 1970s and 1980s (Dunlop more so than Kerr). This pub-
lication record, augmented by their highly visible public service careers
and work as top-level arbitrators and mediators in labor disputes, made
them the two most influential "father figures" of the field in the 1980s.
17. Interdisciplinary research also waned in other fields of study. William Sewell
(1989) notes, for example, that a great wave of enthusiasm for interdis-
ciplinary research emerged in social psychology immediately after World
War II and led to the founding of several significant interdisciplinary re-
search centers but that by the 1970s interdisciplinary research had almost
vanished. He attributes the decline to the threat posed by interdisciplinary
research to the traditional departmental structure of American universities,
the lack of adequate funding for such research, the lack of a breakthrough
in integrative theory, and the concentration on research methods.
18. George Shultz (1964:25) said of this problem: "The field of industrial
relations is thus confronted by a dilemma. On the one hand, the potential
contribution of the several disciplines, as disciplines, is widely recognized;
yet, on the other hand, the tradition of tackling a problem on its own
terms tempts the industrial relations student to be a sort of jack-of-all
disciplines. As master of none, however, he may well lose the essential
analytical power of each and, in the process, lose the really professional
content so essential to careful and precise analysis. This interdisciplinary
trap is especially dangerous where degree programs in industrial relations
as such are offered .... The effort to cover all aspects of the field almost
inevitably leads to the professional content of each individual discipline
being seriously diluted" (emphasis in original).
19. Jack Barbash supports this supposition (1989a:3): "If we are not bound by
one theory it is just possible that common values inform our work."
20. Paul Webbink (1954:103) alludes to this in his reference to the "apparent
resistance on the part of some economists toward the participation in
industrial relations research of collaborators or competitors from other
disciplines."
21. Clark Kerr (1978:132) observed that "before World War II ... the field
[industrial relations) had no core; it was fractionated among: the neoclas-
sicists ... the institutionalists ... the Marxists ... the antimonopolists ...
and the 'Human Relations' school." He then discusses the events of the
1950s (p. 134): "The field now had a core to it. The core might be identified
as 'neo-institutionalism,' drawing on theory and practice, on the operation
of competitive markets and organized power, and the various mixtures of
them; concerned with the impact of institutions on markets and of markets
on institutions."

240
 Notes to pages 134-41

22. My view is that the split between the PM and the ILE schools was caused
by three types of "forces" that could be labeled as "push," "pull," and
"dissolving." The push came from the antagonistic attitude of the ILE
school toward the human relations movement and the policy implications
it represented; the pull from the attractiveness of establishing a separate
field of study devoted to the study of organizations and management from
a behavioral science perspective; and the dissolving from the pressures of
science-building, which weakened the incentives for cross-disciplinary col-
laboration. Although the "push" force from the ILE school was a contrib-
uting factor and no doubt hastened the divorce between it and the PM
school, I suspect that the impact of the "pull" and "dissolving" forces were
equally if not more important and that the effective demise of the "mar-
riage" between the two groups was a matter of when not if.
23. That industrial relations became more "liberal" and "pro-union" after 1960
is supported by the research of Goddard (1992b). Based on statistical anal-
ysis of data from an attitudinal survey of Canadian faculty members teaching
employment-related courses, he concluded that faculty in IR centers were
more "left-wing" than faculty from either management or economics de-
partments. Since the latter two groups were the ones that tended to drop
out of the field of industrial relations after 1960, the net effect was that
the field swung toward the more liberal end of the ideological spectrum.

7. INDUSTRIAL RELATIONS IN DECLINE

1. Union membership in Canada increased from 3.2 million to 4.0 million
in the 1980s, while it declined in the United States from 22 million to 16
million. The divergent growth rates in the two countries were reflected in
the equally divergent fortunes of academic industrial relations. Canadian
IR experienced a modest boom as new academic programs were created
and faculty hired, while academic IR in the United States experienced a
marked decline. The labor movement in Great Britain also experienced a
decline in membership and power during the 1980s (not unexpectedly since
the social and economic policies of Margaret Thatcher closely paralleled
those of Reagan), but academic IR weathered the decade in better shape
than its American cousin.
2. Two early examples of the negative view of labor unions held by the
Chicago economists are provided by Henry Simons (1948) and Milton
Friedman (1951). Also see Harry Johnson and Peter Mieszkowski (1969).
A relatively balanced view of unions by a Chicago-trained economist is
provided by Albert Rees (1989).
3. Regarding the origins and meaning of the term human resources, John Storey
(1989:4) says: "The term is in fact not new: one can find examples of its
use nearly forty years ago .... But for many years the term carried no special
significance and it tended to be used more or less interchangeably with a
whole host of alternative formulations to signal what most would under-

241
 Notes to pages 143-45

stand as personnel management. In the 1980s it has, however, come to

denote a radically different philosophy and approach to the management
of people at work.... In its reworked usage it often purports to signal the
interweaving of a number of elements which, in sum, demarcate it sharply
from personnel management as commonly understood."
4. A survey by William G. Caples in the late 1950s (Caples 1958) found that
there were twelve graduate-level (master's and/or Ph.D. degree} IR pro-
grams. Paradoxically, Herman's data (1984:A-5) show a significant decline
between 1974 and 1984 in the number of M.A. and M.B.A. programs
with a concentration in IR and HR. I believe this result is spurious, how-
ever, because the 1974 data include a more heterodox group of subfields
(e.g., labor economics, education, political science) than does the 1984
data.
5. Estimates of the number of IR and HR programs in the United States vary
widely, as the data cited indicate. Fifty-seven IR and HR units belong to
the University Council of Industrial and Human Resource Programs, al-
though six are outside the United States and an undetermined number are
research units that have no degree program. Hoyt Wheeler ( 1988b) puts
the number of autonomous IR and HR graduate programs at about twenty-
five to thirty. He estimates that about two-thirds are IR and one-third are
HR in orientation.
6. The position of the IR academic programs toward management education
has traditionally been ambivalent. On the one hand, the great majority
of IR graduates, both in the 1950s and in recent years, have taken jobs
in management (Caples 1958; Fossum 1987). On the other hand, the
majority of the administrators and faculty of the programs have a phil-
osophical commitment to pluralism and collective bargaining. The cur-
riculum and value system imparted to the students have thus been
generally more union-oriented than most firms desire but is justified on
the grounds that it provides students with a balanced perspective. This
position is clearly reflected in the remarks of Arnold Tolles (1958:253):
"The fact that the majority of graduates were to be employed by man-
agement did not imply that the curriculum must be management-oriented .
. . . The teaching should be less concerned with providing tools than with
broadening the perspective of the student." Tolles's position was a viable
one in the 1950s when few business schools provided much in the way of
personnel coursework or programs, but it is increasingly untenable today
(for job market reasons, if not intellectual ones), when business schools
offer comprehensive programs in OB and HRM that are expressly tailored
to meet the needs of management.
7. The term industrial relations has become a handicap even for programs that
have maintained an ILE focus. Cleveland State University, for example,
recently renamed the Industrial Relations Center the Labor-Management
Center. According to the center's director, the major reason for doing so
was that the city's public sector unions had become its largest constituency

242
 Notes to pages 147-49

and they objected to the word industrial because it inaccurately suggested

that the center primarily served blue-collar manufacturing workers.
8. In the 1950s, for example, the University of Iowa established an inter-
disciplinary department of labor and management in the business school.
Its primary focus was labor-management relations, and most of the faculty
had a background in institutional economics or law. In the early 1970s,
the department was reorganized to include more of a human resource
and behavioral science orientation, and the name was changed to the
Department of Industrial Relations and Human resources. The department
was reorganized again in 1989 to bring in the organizational behavior
program and faculty, and the name was changed again, this time to the
Department of Management and Organization. The net effect of these
changes has been to shift the program steadily from IR to HR to OB.
The only vestige of industrial relations remaining is several traditional
IR courses and a master's of arts degree in IR. The former chairperson
of the program, Tony Sinicropi, stated in a telephone conversation that
IR is "the lowest rung on the departmental ladder" and will probably be
phased out.
Another example is the IR program at Georgia State. It was created in
1973 and housed in the business school. Until the late 1980s, the emphasis
of the program 'was on labor-management relations and all of the active
faculty were ILE-oriented. In 1987, the personnel program in the man-
agement department was moved to the institute and the program was
renamed personnel and employment relations. Currently, only one out of
the ten required or elective courses pertains to collective bargaining per
se. Both the PM and the ILE schools are represented in the faculty, but
the proportion of labor economists active in the program has fallen
significantly.
9. The last IR-labeled, free-standing, multidisciplinary, degree-granting IR
institute to be established that I know of was the Center for Labor and
Industrial Relations at the New York Institute of Technology, created in
1978. Two IR-related research units were established in the 1980s, how-
ever: the Labor Research Center at the University of Rhode Island and
the Industrial Relations Center in the Graduate School of Business at
Columbia University. The Columbia unit was subsequently disbanded late
in the decade.
10. One sign of the renewed interest in IR theory was the creation in the mid-
1980s of a special study group devoted to industrial relations as a field and
industrial relations theory within the International Industrial Relations
Association.
11. In contrast to the United States, a number of articles on IR theory were
published in Great Britain during the 1970s. Examples include Blain and
Gennard 1970, Ward et al. 1975, Singh 1976, and Walker 1977. Also see
Hameed 1982. The discussion in these articles tends to be rather desultory,
however.

243
 Notes to pages 149-55

12. A review and assessment of Kochan's book by six leading IR scholars is

provided in the winter 1982 issue of Industrial Relations. See, in particular,
the review by Derber.
13. For a series of reviews of the book, see the April 1988 issue of Industrial
and Labor Relations Review. Additional in-depth reviews are in Chelius and
Dworkin 1990.
14. Freeman and Medoff can also be criticized for several sins of omission.
Although they do not acknowledge it, the idea that unions lead to various
forms of economic efficiencies (e.g., reduced turnover, higher productivity)
has a long intellectual history. See Millis and Montgomery (1945:370-73),
for example. They also ignore the ILE school's fundamental economic
justification for collective bargaining-that it eliminates labor's inequality
of bargaining power-and thus cede to their critics that union wage gains
are a monopolistic form of price distortion.
15. See the January 1985 issue of Industrial and Labar Relations Review for a
series of reviews of the book.
16. The renewed interest in IR theory in the 1980s led to introspection similar
to that in the 1960s regarding the disciplinary status of the field, the
deficient state of IR theory, the pros and cons of interdisciplinary research,
and research methodology. See Cappelli 1985; R. Adams 1988, Hebert,
Jain, and Meltz 1988; Chelius and Dworkin 1990; and Goddard 1992a.
17. The "notice to potential contributors" in the October 1989 issue supports
the view that the journal's mix of articles had become lopsided in favor of
labor economics and collective bargaining topics. It says (p. 3): "Members
of the Editorial Board are concerned that many scholars believe the journal
welcomes only papers on labor economics and collective bargaining ...
We should like to assure potential contributors that we welcome papers
from all the specialties of our field, including organizational behavior, labor
law, labor history, human resources, personnel management, income se-
curity, union administration, and international and comparative labor re-
lations" (emphasis in original).
18. A decade earlier (1976) a review committee under the direction of Richard
Lester had performed many of the same functions as the Kerr-Dunlop
committee. The conclusions and recommendations of that committee are
in its final report (IRRA 1977).
19. The report of the Lester committee (IRRA 1977) noted that a frequently
heard complaint from members was that the intellectual substance of the
publications of the IRRA needed to be upgraded. Although progress has
been made on this front in recent years, I believe this complaint still has
merit. In an attempt to provide hard evidence of this deficiency, I examined
volumes 42 and 43 (October 1988-July 1990) of the Industrial and Labor
Relations Review and added up the number of citations to articles in the
three publications of the IRRA: the proceedings of the winter and spring
meetings and the annual research volume. (The articles in the proceedings
of the spring meeting are also published in the August issue of Labor Law

244
 Notes to page 155

Journal, which I therefore included. ) For comparison purposes, I also added

up the number of citations to Industrial Relations and the Journal of Labor
Research. My presumption is that the "quality" of a publication will be
reflected in the number of citations that are made to articles contained in
it. The results were as follows: winter IRRA proceedings, 24; spring IRRA
proceedings, including Labor Law Journal, 3; IRRA research volume, 10;
Industrial Relations, 49; and the Journal of Labor Research, 38. These data
indicate, I believe, that the proceedings of the spring meeting have a near-
zero impact on IR research, that the annual research volume is of marginal
importance (more than half the citations to the volume were to several
articles in the 1987 volume edited by Kleiner et al.), and that the pro-
ceedings of the winter meeting have a perceptible but nevertheless modest
impact. Taken as a whole, the publications of the IRRA therefore seem
relatively peripheral to academic research in the area of employer-employee
relations.
20. The report of the Lester committee (IRRA 1977:10) states in this regard:
"A frequently expressed criticism by young members, but also by some over
50 years of age, is that the meetings and other Association activities are
too dominated by the more senior members." This problem was acknowl-
edged again in the work of the Kerr-Dunlop committee (IRRA 1988b:1):
"We need to increase the participation of younger members in the IRRA.
In many cases, new scholars feel at a disadvantage in opportunities to be
on the program." Several positive steps have recently been taken to address
this problem, including having a poster session and dissertation roundtable,
improving communications to the membership concerning submission
deadlines and procedures, and using an open-submission process to select
session topics for the winter meeting instead of a "by-invitation" method.
The principal source of the complaint has not been entirely remedied,
however, which is the limited number of competitive paper sessions at the
winter meeting. On the recommendations of the Lester committee, the
IRRA began to include three to four contributed paper sessions in each
program of the winter meeting (out of a total of eighteen to twenty). The
Kerr-Dunlop committee did not recommend any further increase in the
number of such sessions, an unfortunate decision in that it perpetuates the
long-standing feeling among a significant proportion of the membership
that it is who you know, not what you know, that at least in part determines
who is included on the program.
21. Everett Kassalow (1985:13) said in his IRRA presidential address that "the
United States continues to need a strong and growing labor movement."
It is difficult to measure an organization's ideological climate, but a person
who said the opposite almost certainly would be neither welcome nor
nominated for high office in the organization.
22. Academics who have served as IRRA president since 1975 include Gerald
Somers, Irving Bernstein, Ray Marshall, Charles Killingsworth, Jack Bar-
bash, Milton Derber, Jack Stieber, Everett Kassalow, Lloyd Ulman, Phyllis

245
 Notes to pages 155-61

Wallace, Robert McKersie, and James Stem. All but two are economists
(Bernstein and McKersie), all the economists are in what I consider the
ILE school (certainly none is a neoclassical economist of the Chicago
school), and none has taken a stance in their published writings that could
be construed as being even mildly critical of the basic principles and pur-
poses of trade unionism and several (e.g., Marshall, Derber, Barbash, Kas-
salow) are clearly supportive of trade unionism. It is also instructive to
examine who has not been elected president of the organization: prominent
labor economists affiliated with the University of Chicago (e. g., Albert
Rees, Melvin Reder, H. Gregg Lewis), academics who have been critical
of unions and collective bargaining (e.g., Herbert Northrup}, and persons
whose primary interest is in the management side of employer-employee
relations (e.g., Edward Lawler, Peter Drucker, Paul Lawrence).
23. It is difficult to quantify feelings of disenfranchisement and estrangement,
but one circumstantial piece of evidence exists. The Kerr-Dunlop com-
mittee commissioned a survey of the IRRA membership in which a wide
range of questions were asked concerning the activities and programs of
the association. Only an 18 percent response rate was obtained. In a letter
to the committee, David Lewin (1988b:9} said: "One wonders (disheart-
eningly) whether the bulk of the IRRA membership has given up. The 18
percent response rate to the recent survey suggests a 'yes' answer to this
question, as do many of the comments reproduced in the report of the
survey. At the 1987 annual meeting in Chicago, numerous IRRA members
speculated about the lack of even one 'younger' scholar on the Review
Committee. My purpose in mentioning these sensitive matters is not to
apportion blame; instead it is to suggest that the Review Committee may
have before it substantial evidence of the disillusionment of a large portion
of the Association's membership-particularly its younger members" (em-
phasis in the original).

8. INDUSTRIAL RELATIONS IN THE 1990s AND BEYOND

I. According to Irving Bernstein (1985), "reform cycles" occur about every
thirty years in the United States. The peaks of three such cycles occurred
during the progressive era, the New Deal Era, and the period of New
Frontier and Great Society. He speculates, therefore, that the mid-1990s
will see the birth of another reform movement, largely in reaction to the
excesses of the Reagan and Bush years. Although certain events make this
scenario plausible (e. g., the loss of employment security by all ranks of
American workers and the stagnation of real family income), it remains
highly problematic. Were such a reform movement to appear, however, it
would clearly be a favorable development for industrial relations.
2. The HR side of the field has produced many highly acclaimed, more pop-
ular-oriented books in recent years that examine the management of people
and the conduct of employer-employee relations. These include In Search
of Excellence (Peters and Waterman 1982) and When Giants Learn to Dance

246
 Notes to pages 161-65

(Kanter 1989). The challenge for IRis to produce a stream of equivalent

works. Probably the most noteworthy in recent years is And the Wolf Finally
Came (Hoerr 1988), although its message does not inspire enthusiasm for
the study and practice of industrial relations.
3. The continued commitment of IR scholars to the New Deal system is
evident in the report published in the winter 1983 issue of Industrial Relations
(pp. 125-31) that summarized the conclusions of a two-day conference
entitled "The Future of Industrial Relations," attended by twenty-nine of
the field's leading researchers. The report states (p. 129, 131): "The con-
ferees identified strongly with free collective bargaining .... To the extent
that the conference had a theme, it was that of continuing faith in the
efficacy of collective bargaining as the cornerstone of the American in-
dustrial relations system .... The conference closed with what came close
to a consensus: our economic and social problems can best be resolved
through tripartite union-management-government discussion and
collaboration."
4. One of the first persons to question the relevance of the term industrial
relations to a service, white-collar economy was Thomas Spates ( 1944). IR
scholars have advanced two arguments in an attempt to rebut this criticism.
Barbash ( 1989b: 114), for example, claims that industrial must be interpreted
broadly to include any large-scale, efficiency-directed enterprise, while Mar-
shall (1987:67) claims that industrial should be interpreted in a generic
sense to mean a particular line of business activity, such as the service
industry or banking industry. I suspect these arguments will not be suc-
cessful, given the widespread tendency of people in both academe and
business to equate industrial with manufacturing.
5. The atrophy of the IRRA is reflected in the increase in the average age of
its members. In 1977, the membership's average age was forty-six, which
the Lester report (IRRA 1977:3) characterized as "fairly mature." The
IRRA ceased asking members for their birth year in the late 1970s, but
other evidence strongly suggests that the average age of the membership
has almost certainly increased. For example, based on a sample of the
academic members listed in the 1972 and 1990 IRRA membership direc·
tories who had Ph. D., D. B., or J.D. degrees and whose family names began
with the letters A-D, I found that the average years in which they received
their doctoral degrees were 1959 and 1972, respectively. Thus, in 1972,
the average academic member had been out of school for thirteen years,
while in 1990 the average member had been out of school for eighteen
years (a 38 percent increase).
Another indicator of organizational decline is that the association is
having an increasingly difficult time finding presidential nominees who
meet the requirements of distinguished contributions to the field and a
record of active participation in the organization, including past service
on the executive board. Most of the people who meet the first requirement
(e.g., Richard Freeman, Edward Lawler, William Usery) are not active

247
 Notes to pages 166-67

members, while an ever-diminishing number of active members have a

prominent national reputation.
6. The founders of the IRRA wanted to promote an active interchange be-
tween academics and practitioners and for that reason opened its ranks to
persons from both groups. Efforts were made, in tum, to obtain a balanced
representation among practitioners by including members from the three
parties to the employment relationship-business, labor, and govern-
ment-in the organization. The mixing of academics and practitioners was
intended to foster a cross-fertilization between academic research and real-
world practice, a goal I strongly support and one the IRRA has made
important contributions toward achieving.
But this organizational structure has also resulted in the representatives
of organized labor having a disproportionate influence on the association's
programs and policies. In theory, the inclusion of business people should
have provided a political counterweight to organized labor, particularly
since the former represent a greater share of the IRRA's national mem-
bership than the latter. In practice, however, it has not worked this way.
First, organized labor has a larger stake than business firms in keeping the
association in the ILE camp and thus takes a more activist role in it.
Second, the business people nominated for office in the IRRA come from
unionized companies and for reasons of both philosophy and self-interest
have strong incentives to avoid staking out a position that union members
might construe as antilabor. And, third, the academic leaders of the IRRA
have traditionally been extra-sensitive to the opinions of organized labor
on policy and program issues, both because of their ILE philosophical bent
and their desire to avoid internal political battles. For these reasons, or-
ganized labor, in coalition with other allies (e.g., arbitrators and mediators)
who have a vested interest in preserving the traditional collective bar-
gaining system, exercise greater political power in the IRRA than is sug-
gested by their membership numbers, giving them, in my estimation,
effective veto power over substantive matters of policy. This opinion is
supported by the comment of a long-time member of the IRRA in written
correspondence to me: "Management doesn't give a damn, but labor has
an almost ironclad veto on everything the IRRA does."
7. A similar exercise in strategic planning is provided in Cutcher-Gershenfeld
1991. A number of his proposals parallel those made here.
8. The term employment relations appeared at the same time as industrial relations
but never achieved the popularity of the latter term. Several doctoral
dissertations written in the 1920s used the term employment relations in
their titles, for example, but the term then largely faded from the literature
(but see Yoder et al. 1958). Recently, however, employment relations has
made something of a comeback, as indicated by its adoption in the titles
of academic degree programs at Georgia State University, the University
of South Carolina, and the University of Cincinnati. The case for replacing
the term industrial relations with employment relations is made by Wheeler

248
 Notes to pages 168-69

( 1988a), whose major argument is that employment relations better indicates

the central subject matter of the field-the employment relationship.
Wheeler's usage of the term employment relations (and, I think, its intended
usage in the program titles mentioned above) is different from what is
proposed in the text. As advocated here, employment relations would be
used as the new name for the field of industrial relations narrowly defined,
while Wheeler would use it as the name for the field of industrial relations
broadly defined (both current-day IR and HR). Although I have made use
of the latter interpretation in other places (Kaufman 1991 b), on reflection
I think the term is not general enough to serve as an umbrella label for IR
and HR combined. The reason is that employment relations gives emphasis
to the word relations, which is central to IR, but omits any term suggestive
ofHR, such as human resources or management. Further, practitioners often
associate employment relations with the subfield of employee relations in
personnel management, rather than with the employment relationship as
an intellectual concept.
9. The distinction between external and internal perspectives in research on
the employment relationship is made by Somers ( 1969, 1972) and is implicit
in the debate between John Dunlop (1950) and William Foote Whyte
(1950) over the merits of the human relations model.
10. The dividing line between internal and external is not a hard and fast one
but rather a useful generalization for distinguishing between two approaches
to the study of employment-related outcomes in (and between) organiza-
tions. The reality of this distinction is best seen by examining research in
the areas that represent the "pure cases": micro-organizational behavior
and neoclassical labor economics. Micro OB seeks explanations for em-
ployment outcomes in variables that reside internal to the organization
(often internal to the individual), while the environment or "context"
external to the organization is generally treated as a given (Cappelli 1990).
Neoclassical labor economics, by contrast, looks at market forces external
to the organization as the cause of these same phenomena and generally
treats factors internal to the organization as a given (or "black box") (Lewin
and Feuille 1983).
Two other fields provide the intellectual bridge between these two polar
cases. They are, respectively, industrial relations and organization theory
(macro OB). Industrial relations studies the transmission process between
the multidisciplinary array of external environmental forces and the struc-
tures, practices, and behaviors internal to the firm. Organization theory
does much the same, but the perspective is from inside the firm looking
out. Since there is clearly conceptual overlap, the internal versus the
external distinction tends to get fuzzy in practice in research projects that
are close to the interface of the two fields (see Begin 1990). The external
versus the internal distinction nevertheless has considerable explanatory
power as a general way of typing the theoretical and empirical approach
to research in the fields of HR and IR.

249
 Notes to pages 169-70

11. The reorientation I advocate, and the reasons it is necessary, is amply

illustrated by the textbooks currently used in traditional IR and HR courses.
The typical IR course uses a text devoted to the subject of collective
bargaining and labor-management relations, while the typical HR course
uses a book that focuses on the practice of human resource management.
While there is some overlap in material (the HR book will have a chapter
or two on labor relations, the IR book a chapter or two on the structure
and functions of management), the student comes away with the impression
that IR and HR are largely separate subjects whose major intellectual
dividing line is that one deals with unions and the other with management.
Not only does this dichotomy fundamentally misrepresent the true nature
of the differences that have historically distinguished the PM and ILE
perspectives on the employment relationship, but given the small and
dwindling size of the union sector in the economy, it obviously places the
continued survival of IR courses and curricula in jeopardy.
Both on intellectual and pedagogical grounds, the preferable approach
is to combine the IR and HR courses into one introductory course; make
the mission of the course the study of the institutions, practices, and
outcomes of the employment relationship and the public policies that
structure and regulate this relationship; and present IR and HR as different
approaches to the analysis of these subjects. In tum the distinction between
IR and HR should be made on the basis of the differences in their underlying
assumptions about the employment relationship (e.g., conflict of interests
versus congruence of interests), their theoretical approach to the study of
the subject (e.g., emphasis on internal versus external environments), and
recommendations concerning policy and practice. This approach, essen-
tially the one taken by the labor problems texts of the 1930s, needs to be
rediscovered and used as the basis for an introductory employment relations
course in every college curriculum. (I think the intellectual value-added
from such a course in M.B.A. programs, for example, would be significantly
greater than that obtained from the standard core course in organizational
behavior.) Human Resources Management and Industrial Relations, by
Thomas Kochan and Thomas Barocci (1985), provides one example of the
approach I am advocating.
12. A corollary is that some union-related topics traditionally considered within
the corpus of industrial relations would become part of HR, such as the
determinants of membership commitment to the union as an organization
and studies of militancy among union members.
13. Dunlop's model of industrial relations systems focuses on the employment
relationship, integrates various external environmental variables (e.g.,
technology, law, product and labor market forces, ideology), has a cross-
disciplinary perspective, and is avowedly science-building in purpose.
While certain aspects of the model are questionable (e.g., the focus on
rules as the dependent variable in IR research), it nevertheless illustrates
the feasibility and fecundity of the approach advocated here. This generally

250
 Notes to pages 170-77

favorable reference to Dunlop's model contrasts sharply with the critical

review it received in chapter 5. My major objection there was that it
purported to be a general model of industrial relations when, in fact, it
omitted consideration of the internal perspective of the PM school, which
was still very much a part of industrial relations in the 1950s. This criticism,
while of continuing relevance from a historical perspective, is moot for
present-day industrial relations to the extent that the field is defined more
narrowly, as advocated here. Nonetheless, I continue to feel that the
excessively imperialistic stance the book takes vis-a-vis the PM school works
against constructive dialogue.
14. Strike studies are a good example. Both HR and IR scholars publish research
on strikes, but the studies have far more in common within HR and IR
categories than across categories (see Gallagher and Gramm 1991). Thus,
the strike studies by externally oriented researchers, such as economists
and sociologists, typically use the number of strikes from a time-series or
cross-section data set as the dependent variable and attempt to explain the
variation with various independent variables that measure characteristics
of the external environment (unemployment rate, size of union member-
ship, and so on). HR researchers, in contrast, tend to look at either
attitudinal constructs related to strike intentions or the psychological con-
sequences of strike action as the dependent variable and attempt to explain
the variation with independent variables that measure personal demo-
graphic and psychological characteristics (gender, feelings of inequity).
15. A particular challenge to the ILE model in this regard is Fox's (1974)
contention that a system of workplace governance based on a pluralist
ideology will inevitably experience a secular decline in performance because
of the mutual low-trust, high-conflict relationships that exist between work-
ers and employers.
16. See Strauss ( 1990) and Cappelli (1990) for alternative suggestions of how
IR should be reconceptualized. Both argue that IR should take a relatively
macro perspective on organizational and employment issues. Strauss further
argues that two of the major topical areas of IR should be "employment
systems" and "justice systems." Although both are insightful concepts, they
do not represent a division of knowledge that clearly separates IR from
HR, a division that I contend is not only inherent to the study of the
employment relationship, but one that also facilitates science-building.
17. The title industrial and labor relations adopted by the IR program at Cornell
University in the 1940s originally had the requisite level of generality but
no longer does. As I interpret it, the name was meant to convey that the
program covered all aspects of the employment relationship (the original
meaning of the term industrial relations) but that particular emphasis was
· placed on unionized employment situations (the meaning of the term and
labor relations). Since most people today regard the terms industrial relations
and labor relations as equivalent, this label has a significantly narrower
meaning; in effect that the program addresses only unionized employment

251
 Notes to pages 182-84

situations. Because this meaning is neither correct nor viable in the long
run from a marketing perspective, I predict that eventually the name of
the Cornell program will be changed (or some other strategem found to
accomplish the same purpose). Doing so will mark the end of an era.
18. The term research should also be dropped from the title since it has little
relevance to the practitioner members of the association, who outnumber
the academic members by a wide margin. My suggestion for a new title is
the American Employment Relations Association or the Association for
the Advancement of Employment Relations.
19. Planning and organizing an independent meeting would, however, entail
a significantly greater expense for the IRRA, an expense it may not be
able to bear given its extremely tight budget. One option is to eliminate
the spring meeting and use those funds to support an independently held
winter meeting.

252
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279
 INDEX

Academy of Management, 153, 167, 184, Blum, Solomon, 84, 224, 228
185 Boston Employment Managers' Association,
Academy of Political Science, 206 204
Adams, Henry Carter, 31 Brissenden, Paul, 47
Advances in Industrial and Labor Relations, British University Industrial Relations
150 Association, 216
Alabama, University of, 145 Brody, David, 113
Allied Social Science Association (ASSA), Brooks, Earl, 219
181, 185 Brophy, john, 219
American Association of Collegiate Schools Brown, J. Douglas, 71, 201
of Business (AACSB), 144, 212, 217 Burling, Temple, 219
American Association for Labor Research, Burton, Montague, 211
230 Bush, George, 141
American Economic Association (AEA),
70, 90, 155, 181, 221, 228, 229 California, University of (Berkeley), 63,
American Federation of Labor (AFL), 62, 66, 103, 143, 148, 216, 220
215 California Institute of Technology, 46, 57,
American Management Association, 11, 212
46, 49, 205, 206 Canada, 199, 216, 241
Argyris, Chris, 91, 223, 224, 232-33 Canadian Industrial Relations Association,
216
Bakke, E. Wight, 71, 81, 234 Chamberlain, Edward, 91
Balderston, C. Canby, 50 Chamberlain, Neil, 92, 129
Barbash, Jack, 134, 149-50 Chicago, University of, 10-11, 63, 80, 92,
Bargaining power, inequality of, 28, 32-33, 122, 147. 217, 225, 226
34, 38, 41, 61, 171-72, 215, 224 Civic Federation, 8
Barnard, Chester, 206, 207, 221 Clague, Ewan, 71
Barnett, George, 12, 207 Clark, John Bates, 31, 207
Beach, Charles, 219 Classical economics, 4-5, 26, 30, 200-201
Becker, Gary, 91, 122, 226 Cleveland State University, 103, 242
Behavioral sciences, 51, 76, 90, 101, 102, Collective bargaining, 8, 9, 19, 20, 25, 28,
115-16, 119-21, 124-25, 129-30, 153- 34, 40-43, 48-49, 61, 68-69, 81-82,
54, 166, 237 86-89, 98-99, 102, 104, 113-14, 124,
Bloomfield, Daniel, 11, 57, 204 130, 133, 138-43, 170-75
Bloomfield, Meyer, 11, 57, 204 Columbia University, 47, 147, 243

281
 Index

Colorado Fuel and Iron Co., 46, 211 Fair Labor Standards Act, 61, 138
Commission on Industrial Relations, 3, 8, Fayol, Henri, 207
9, 199, 213 Federal Reserve Bank, 35, 40, 210
Commons, John R., 8, 10, 12, 30-32, 33, Feldman, Herman, 12
35, 38, 39, 54-56, 57, 60, 70, 82, 85, Follett, Mary Parker, 206
134, 200, 20!, 203, 206, 207, 206, 210, Form, William, 50, 83, 116, 213, 237-38
2!2, 213, 214, 224, 225, 227 Freeman, Richard, 149, 244
Company unions. See Employee Friedman, Milton, 91, !22, 224
representation plans Full employment, 31, 34, 40
Congress of Industrial Organizations (CIO),
62 Gantt, Henry, 22
Cornell University, 63-64, 66, 67, 71, 72, Gardner, Burleigh, 80, 92
80, 103, 143, 144, 217, 218-19, 232, Georgia State University, 103, 145, 243,
25!-52 248
German historical school, 30, 31, 228
Great Britain, 86, 151, 199, 200-201, 211,
Davis, Ralph, 207 213, 2!6, 241, 243
Day, Edmund, 72 Great Depression, 60, 63, 86, !22
Dennison, Henry, 206
Derber, Milton, 91, 94, 235 Haber, William, 71
Dickson, William, 51, 78, 101 Harbison, Frederick, 91, 94, 227
Douglas, Paul H., 11, 55, 207, 225, 226 Harvard University, 10, 24, 51, 77, 82,
Drive system, 7-8, 9, 26 220
Dunlop, John, 71, 85, 87, 88-91, 94, 95, Hawaii, University of, 63
97, 98, 99-102, 118, 124, 148, 149, Hawthorne experiment, 21, 24, 51, 76-80,
!52, 170, 184, 217, 226, 227, 228, 234- 82, 205-6, 222
36, 240, 250 Heneman, Herberr, Jr., 67
Durkheim, Emile, 221 Hicks, Clarence, 35, 46-47, 57, 134, 203,
206, 211, 2!2
Hicks, John, 86, 87, 89, 226, 227, 228
Economic insecurity, 32, 33-34, 35 Hollander, Jacob, 207
Economic man, 26, 207 Homans, George, 77, 92, 95, 101, 223,
Ely, Richard, 31, 207 224, 231
Emerson, Harrington, 22 Howd, Cloice, 201
Employee representation plans, 8, 28-29, Hoxie, Robert, 8, 54, 200, 225
35, 48, 60, 203 Human relations: battle over, 95-99, 100-
Employee Responsibilities and Rights journal, 101, 232; as a field of study, 68, 72, 82,
150 83, 90, 92, !20, 130, 204, 207, 2!7,
Employer-employee relations, 10, 11, 12, 222, 233, 238-39; Hawthorne version,
18, 21, 22, 33, 63, 79, 89, 167, 231 53, 76-83, 96, 22!; pre-Hawthorne, 21,
Employers. See Management 23-27, 37, 38, 40, 48, 76, 80, 206
Employment Act of 1946, 138 Human resource management, 119-21,
Employment management, 21, 201, 205 140, 151, 162, 202, 204, 239
Employment Managers' Association, 11 Human Resource Management Review, 154
Employment relations (term), 167, 176, Human resources (HR), field of, xiv, 20,
182, 248 118-21, 142, 143-48, 158, 162-63, 168-
Employment relationship, 5, 8-11, 18, 2!, 70, 174, 176-77, 180, 181
29, 33, 37, 50, 61, 93, 109, 128, 129, Herzberg, Frederick, 26, 92
158, 168, 176, 229; conflict of interests,
22, 25, 30, 37-38, 60, 96, 202, 232; Illinois, University of, 63, 66, 68, 143,
congruence (mutuality) of interests, 22, 144, 216, 217, 219, 220
25, 27, 29, 30, 31, 37-38, 60 Industrial and Labar Relations Review, 71-73,
Employment systems, 178, 25 1 91, 99, 113-14, 125, 134, 150, 214, 237
England. See Great Britain Industrial conflict, 6, 9, 11, 13, 27, 28, 32,

282
 Index

33, 37, 38, 40, 62-63, 68, 75-76, 131, Institutional economics, 30-32, 56, 58, 61,
141, 215, 231, 232, 251 212, 213, 214, 225, 227, 228
Industrial democracy, 23, 27-29, 33, 34, Institutional labor economics, 19-20, 30-
35, 37, 40, 85, 88 35, 51, 54-56, 84-85, 88, 124-25, 207-
Industrial psychology, 8, 54, 72, 202, 207, 8, 210, 215, 218, 226, 227, 229
215 Institutional labor economics (ILE) school,
Industrial relations: art versus science, 106- 20, 29-43, 48-49, 51, 58, 67, 68, 71,
7; curriculum, 10, 47-48, 63-64, 66, 83, 95, 97-98, 102, 113, 123, 128, 129-
144-46, 176, 238; definition of, 18, 49- 30, 133-34, 140-41, 147, 151, 158,
50, 83, 158, 205, 219, 247; enrollment, 170-73, 203-4, 213, 230, 232, 233, 241
144-45, 162, 221; external versus Interdisciplinary research, 80, 81, 93-95,
internal viewpoint, 36, 96-97, 129-30, 110-12, 123-24, 145, 230, 240
168-70, 175; as a field of study, 9-18, International Industrial Relations
63, 82-83, 88, 92, 95, 100-101, 104, Association, 243
112-25, 128, 158-61, 167-75, 212, 223, International Labor Organization, 57
230, 231, 232, 235, 237, 240, 244. 249- Inter-University Study of Labor Problems in
50; goals of, 13, 21, 133, 202; Economic Development, 94, 227, 228,
intellectual family tree, 50-54, 116-17; 231
and labor education, 65-66, 68-69, 162; Iowa, University of, 103, 243
and labor problems, 4-5, 9, 11-12, 88,
102, 201; multidisciplinary nature of, 12, Janet, Pierre, 221
18, 47, 64, 67, 70, 72. 75, 92-95, 102, Journal of Applied Psychology, 50, 179
107-11, 125-28, 130, 143-44. 164, 177, Journal of Labor Economics, 179
201-202, 212-13, 218; narrow Journal of Labor Research, 150, 245
(collective bargaining) version, xiv, 101-
2, 104, 112-21, 132-35, 144, 158, 159- Kansas Court of Industrial Relations, 11
60, 164-65, 167-68, 170-75, 176, 197; Kerr, Clark, 71, 85, 87, 88-91, 94, 95, 97,
origins of term, 3-4, 199-200, 201; 98, 124, 152, 184, 220, 224, 226, 227,
Ph.D. programs in, 64, 65, 103, 128, 228, 236, 240
143, 217-18, 240; research, 49-54, 91- Keynes, John M., 86, 215
95, 96, 103, 113-14, 119, 125-28, 148- Kochan, Thomas, 117, 148
52,163-65,169-70,177-80,230,237, Konvitz, Milton, 71
240; strategy for change, 167-85; theory,
99-101, 105, 108-10, 125-31, 133, 148- Labor economics, 49, 54, 55, 84-91, 113-
49, 217-18, 243; units (academic 14, 121-25, 205, 208, 212, 226, 229
programs), 10, 45-49, 63-69, 93, 103, Labor legislation, 34, 48, 61, 84, 85, 89-
143-48, 159, 160, 162-63, 175-77, 211- 90, 208, 225, 238
12, 215-20, 242; values, 68, 133-35, Labor market, 6, 30-32, 33, 34, 40, 61,
241 84-91, 208, 212, 214, 224, 225
Industrial Relations, 103, 113-14, 127, 150, Labor mobility, 32, 33, 88
216, 237 Labor problems: causes of, 5-8, 22, 25, 29,
Industrial Relations Association of America 30, 32-35, 36-43, 123, 130-32, 208,
(IRAA), 11, 19, 46, 57, 69-70, 201, 210; concept of, 4-5, 48-49, 200, 201;
203, 205, 210 reform of, 8-9, 10, 20, 21-29, 30, 34-
Industrial Relations Counselors, 46, 57 43, 48-49, 56, 123, 208, 210; texts, 48-
Industrial Relations-Quarterly Review, 216 49, 55-56, 205, 211, 226, 250
Industrial Relations Research Association Labor turnover, 4, 9, 40
(IRRA), 69-71, 88, 90, 91, 99, 103, Laissez-faire, 5, 201, 204, 207
114, 117-18, 132, 152-55, 165-67, 180- Laval University, 216
85, 220, 233, 244, 245, 246, 247, 248, Leighton, Alexander, 219
252 Leiserson, William, 71, 200, 203
Industrial sociology, 51, 52, 68, 71, 95, Lescohier, Don, 207
237-38 Lester, Richard, 70, 71, 85, 87, 88-91,
Industrial Workers of the World, 5 184, 215, 224, 226, 228

283
 Index

Lewin, Kurt, 80, 224 National Bureau of Economic Research

Lewis, H. Gregg, 91, 122, 224, 226 (NBER), 154, 210, 214
Lewisohn, Sam, 206 National Industrial Conference Board 57-
Likert, Rensis, 81, 224 58 . '
London School of Economics, 213, 216 National Industrial Recovery Act, 46, 61
Loyola University (Chicago), 63, 145, 176 National Labor Relations Act, 61, 76, 138,
Ludlow massacre, 211 161, 17l, 215
National Monetary Union, 210
National Personnel Association, 11, 205
McCabe, David, 200
National Planning Association, 94
McGregor, Douglas, 47, 97, 213, 232, 234
239 ' Neoclassical economics, 30, 31, 32, 84-86,
89, 122-25, 140, 239
Machlup, Fritz, 89, 90, 91
Neoclassical restorationists, 122
McKersie, Robert, ll9, 148, 149, 245
Neoclassical revisionists, 204, 210, 218
Maclaurin, Rupert, 4 7 227 '
McPherson, William, 70, 7l
Neoinstitutionalists, 165, 226-27, 239, 240
Management, 6-8, 19, 22, 24-28, 33, 35-
New York Institute of Technology, 243
40, 49, 60, 68-69, 76, 79, 81, 93, 96,
New York University, 63, 66
ll6, ll9-2l, 140-42, 151, 166, 207,
214, 224, 232, 242
Organizational behavior, 76, 113-15, 119-
Marshall, Alfred, 30, 86, 227
Marshall, Ray, 124
21, 140, 144-46, 154, 166, 204, 207,
Marx, Karl, 5, 30, 201, 238
238-39, 243, 249
Organization theory, 68, 120, 207, 219
Maslow, Abraham, 26, 239
Massachusetts Institute of Technology
Pareto, Vilfredo, 221, 234
(MIT), 46, 47, 77, 80, 81, 2ll-l2, 213
Parsons, Talcott, 234
Mathewson, Stanley, 215, 225
Paterson, Donald, 67
Mayo, Elton, 24, 51, 77-80, 82-83, 91,
Patten, Simon, 31
96, 100, 134, 206, 221-22, 225, 231,
Pennock, George, 77, 222
232, 234, 236
Perlman, Selig, 33, 54, 55, 200, 207 212
Medoff, James, 149, 244 219 ' '
Metcalf, Henry, 21, 206
Personnel, 11, 121
Michigan, University of, 46, 48, 81, 148
Personnel Journal, 215
Michigan State University, 68, 143 217
219 ' ' Personnel management: academic field of,
21, 51, 54, 55, 64-66, 68, 82, 113-14,
Mill, John Stuart, 30
Miller, Delbert, 50, 83, 116, 213
120-21, 144, 200, 204, 205, 209, 212,
217, 219-20, 222; practice of, 7-8, 19,
Millis, Harty, 54, 207, 225
21-29, 36, 38-40, 41, 48-49, 51, 60,
Mincer, Jacob, 122
Minimum wage, 19, 34, 49, 61, 89-90
138-39, 206, 209-10
Personnel management (PM) school, 20,
Minnesota, University of, 63, 66, 67, 143,
21-29, 35-43, 48-49, 54, 60, 67, 83,
217, 219, 221
Missouri, University of, 48
95, 97-98, 113, 118-21, 128, 129-30,
Mitchell, Wesley, 30, 31, 210, 214, 215
133-34, 141, 158, 203-4, 220, 222, 230,
232, 233, 241
Monopoly, 32
Monopsony, 33
Personnel Psychology, 120-21, 239
Personnel Research Federation, 215
Montgomery, Royal, 208
Pluralism, 42, 85, 99, 134, 211, 251
Mooney, james, 207
Poffenberger, A. T., 48
Miinsterberg, Hugo, 8
Princeton University, 10, 46-47, 50, 201
Myers, Charles, 47, 85, 88, 91, 94, 97,
211-12 '
101, 227, 234
Problem-solving, 12-13, 20, 66, 100, 106,
125-28, 165, 167, 170, 182-83, 202,
National Association of Employment 204, 220, 228
Managers, 205 Productivity, 9, 41, 139

284
 Index

Psychology, 25, 53, 79-80, 81, 92, 154, Strauss, George, 91, ll8, 232
202, 206-7, 236, 238 Strikes. See Industrial conflict
Purdue University, 146
Taft, Phillip, 55
Queen's University, 46 Taft, William Howard, 3, 199
Taylor, Frederick, 8, 22, 24, 25, 36, 201
Reagan, Ronald, 141 Taylor, George, 71, 91
Reder, Melvin, 91, 122, 224, 246 Tead, Ordway, 21, 48, 206
Rees, Albert, 91, 122, 226, 246
Research methodology, 85, 106-7, llO, Ulman, Lloyd, 91, 245
114, 122-23, 125-28, 164, 179-80, 214, Unemployment, 6-7, 9, 33, 40, 60, 86,
218, 238, 244 208; compensation, 35, 61, 208
Reynolds, Lloyd, 71, 85, 87, 88-91, 226 Unions, 8, 9, 13, 20, 31, 48, 65, 68, 81-
Ricardo, David, 30 82, 89-90, 101, 149, 172-73, 225, 229,
Robinson, Joan, 86 238-43; ILE view of, 34-35, 41-43, 85,
Rockhurst College, 63, 212 88, 89, 210; membership, 60, 61-62,
Rockefeller, John D., Jr., 46, 47, 57, 211 86-87, 132-33, 143, 159, 241; PM view
Roethlisberger, Fritz, 51, 77-80, 100, 232 of, 27-29, 40-41, 96-97, 231-32; role in
Roosevelt, Franklin, 61 improved industrial relations, 27-28, 31,
Rorty, Malcolm, 210 34, 48-49, 210
Ross, Arthur, 85, 87, 91, 235, 236 United States Industrial Commission, 8
Rutgers University, 63, 66, 143 University Council of Industrial Relations
and Human Resources Programs
Samuelson, Paul, 91, 213, 227 (UCIRHRP), xiv, 144, 166, 177
Saposs, David, 207
Science-building, 12-13, 20, 66, 100, 106, Veblen, Thorstein, 30, 31, 225
125-28, 161, 167-68, 170, 182-83, 202, Viteles, Morris, 215
204, 218, 220, 228, 237
Scientific management, 8, 21-24, 26, 36, Wages, 8, 22, 28, 31, 33, 35, 37, 60, 86,
48, 77 88, 139, 209-10, 226, 228
Scott, Walter Dill, 8 Wagner Act. See National Labor Relations
Selekman, Benjamin, 77, 101, 224 Act
Seligman, Edwin, 31, 207 Walton, Richard, 119, 148
Shultz, George, 88, 124 War Labor Board, 9, 62, 87, 218
Stichter, Sumner, 55, 71, 200, 207, 225 Warner, W. Lloyd, 80, 92, 222
Smith, Adam, 30 Warwick University, 216
Social Darwinism, 4-5, 200-201 Watkins, Gordon, 55
Social insurance programs, 19, 35, 48, 61, Wayne State University, 212
208, 238 Webb, Sidney and Beatrice, 27, 30, 34,
Social Science Research Council, 12, 220- 213
21, 233 Webbink, Paul, 220
Social security, 35, 61, 138, 238 Weber, Arnold, 124
Socialism, 4, 5, 8, 204, 220 Weber, Max, 207
Society for Human Resource Management, Welfare work, 8, 21, 22-23
153 Wertheim, Jacob, 10, 82
Sociology, 92, 95, 119, 154, 227, 230, Western Electric Co., 24, 51, 76, 77
233, 237-38 Wharton School (Industrial Research
Solow, Robert, 227 Unit), 10, 45-46, 50
Somers, Gerald, 130, 134, 148, 249 Whitehead, T. N., 51, 77
Spates, Thomas, 57, 203 Whyte, William Foote, 80, 92, 95, 101,
Stanford University, 46, 212 219, 220, 223, 224, 231, 233, 235
Stem, James, 183 Wilensky, Harold, 92, 230-31, 237
Stewart, Bryce, 57 Willets, Joseph, 12, 45-46
Stigler, George, 89, 90, 122 Williams, Whiting, 205

285
 Index

Wilson, Woodrow, 9, 203 Workmen's compensation, 13, 25, 208

Wisconsin, University of, 10, 19, 47, 63, Works councils, 13
66, 68, 143, 150, 207, 211, 213, 215- World War I, 4, 7, 8-9, 21, 22, 23, 63,
16, 217, 218, 219, 224 210
Wisconsin School, 54, 204 World War II, 54, 62, 75, 87, 125, 216,
Witte, Edwin, 54, 70, 71, 73, 200, 207, 218
212, 213-14, 219, 224, 229
· Wolman, Leo, 200, 235 Yale University, 57, 63, 66, 67, 81
Work effort, 7, 9, 28, 33, 36, 40, 121, Yoder, Dale, 55, 67, 71, 91, 212
205, 206 Young, Arthur, 57, 206

286
ABOUT THE AUTHOR
Bruce E. Kaufman is director of the W. T. Beebe Institute of Personnel
and Employment Relations and is a professor of economics at Georgia
State University, where he has served on the faculty since 1977. He
received his Ph.D. in economics from the University of Wisconsin and
has published widely in the field of industrial relations.