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Should We Clash or Should I Go? The Impact of Low Wage and Poor Working Conditions on the Exit-Voice Trade-Off

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Godechot,  Olivier
Assoziierte Wissenschaftlerinnen und Wissenschaftler, MPI for the Study of Societies, Max Planck Society;
Max Planck Sciences Po Center on Coping with Instability in Market Societies (MaxPo), MPI for the Study of Societies, Max Planck Society;

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Labour_33_2019_Godechot.pdf
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Citation

Godechot, O., & Salibekyan, Z. (2019). Should We Clash or Should I Go? The Impact of Low Wage and Poor Working Conditions on the Exit-Voice Trade-Off. Labour, 33(4), 425-449. doi:10.1111/labr.12155.


Cite as: http://hdl.handle.net/21.11116/0000-0003-ABB9-C
Abstract
We use two linked employer–employee datasets to adapt Hirschman's model of consumer behaviour into the labour market and to argue that dissatisfaction with pay should favour exit while dissatisfaction with working conditions should favour voice. A deterioration of our working conditions index increases the probability of participation in collective action when an increase in log hourly wage decreases the probability of quitting. A rationale for this trade‐off is based on information: first, information on the price of alternative options is more accessible than information on their quality; second, voice produces more information than exit and favours opportunities for specific improvements.