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In recent decades, capitalist globalization has entailed a new international division of labor with the relocation of some stages of manufacturing production from the Center to the Periphery through the Global value chains (GVCs). This new pattern of global production is marked by wide income disparities between the different regions of the world economy, accentuated by value transfers hidden within both traditional and GVCs international trade. The chapter presents a theoretical model based on a Marxian approach for the accounting of unequal exchange in international trade in value-added, resulting from the decoupling of value-produced and value-captured inside and outside GVCs. The empirical results show the ongoing relevance of unequal exchange in contemporary capitalism as one of the fundamental causes of disparities in income and economic development among the countries of the global economy.

In this chapter, we propose a theoretical assessment of the relationship between unions and investments. We develop a simple model where a firm chooses its investment level anticipating the employee's effort choice and the outcome of wage bargaining. First, and consistently with the holdup view, we find that the union's bargaining power has a negative effect on the accumulation of fixed capital. Second, we show that this negative effect is mitigated by the voice ability of unions to ease the displeasure of exerting effort. Hence, when the voice ability of unions is strong vis-à-vis their bargaining power, the holdup view does not necessarily survive, and unionized firms invest more than their nonunionized competitors.

This chapter explores the relationship between performance-related pay (PRP) and productivity in the Italian economy. It contributes to the literature in two main ways. First, it provides estimates for the PRP – productivity relationship based on a nationally representative sample of manufacturing and services companies (other studies on Italy are more limited in scope, since they focus on specific sectors). Second, it addresses the question of firms' heterogeneity, an aspect so far not examined in relation to PRP in Italy. We use a two-step approach. In the first step, we estimate a classical production function using longitudinal data on the balance sheet variables of Italian firms over the period 2002–2005. In the second step, we regress the distribution of the firm-specific fixed effects on dummy variables for the presence of PRP and unions, as well as on control variables for the year 2005. The most important results are that the adoption of PRP is positively and uniformly correlated with productivity throughout the whole distribution and that the presence of trade unions has a positive association with firms' unobserved productivity across all quantiles, being significantly higher for the best performing firms (those placed at the highest quantile of the productivity distribution).

Continuing in the tradition of earlier volumes in the series, the 12th edition of Advances in the Economic Analysis of Participatory and Labor-Managed Firms interprets the themes of the series quite broadly and, consequently, the following pages traverse a highly variegated terrain. I have marked this expansive landscape with four guideposts around which our discussion is organized, namely sections on job design and organizational performance (Part I); compensation, worker attitudes, and productivity (Part II); worker cooperatives and nonprofit organizations (Part III); and free trade and the ecological effects of alternative socio-economic systems (Part IV). The following essays exhibit a diversity of topics, data sources, modes of analysis, geographic contexts, and philosophies. The contributors are similarly diverse, hailing from seven countries, with representation both inside and outside of academia. It is my hope that, in addition to contributing to our knowledge of the broad subject at hand, the articles contained in this volume will inspire productive future work on the important questions addressed herein.