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This volume of Advances in the Economic Analysis of Participatory and Labor-Managed Firms comprises nine original research chapters and a short comment.¹ The chapters cover a broad range of topics: from share ownership plan membership to determinants and performance outcomes of adoption of high performance work and pay practices, to changes in traditional participatory organizations. Geographically, the chapters span over a relatively wide range: from Northern Europe, a southeast European transition economy, Israel, Korea, Japan to an international corporation with operations in at least four continents.

The series Advances in the Economic Analysis of Participatory & Labor-Managed Firms was launched 25 years ago by Derek C. Jones and Jan Svejnar. Since then, Advances has been a leading forum for high-quality original theoretical and empirical research in the broad area of participatory and labor-managed organizations. Although general and specialized journals publish work in this field, many do so only occasionally. Advances has been the only annual periodical that presents some of the best chapters in the field in a single volume.

There is abundant evidence that innovative work practices (IWPs) of various kinds, such as teams, quality control circles, no-layoff policies, job rotation, and employee ownership, have spread rapidly in developed market economies during the past thirty years or so. Between 1983 and 1993, Freeman, Kleiner, and Cheri (2000) report survey evidence that the number of nonmonetary incentive programs offered by firms increased by 500% in the United States. Similar trends appear to be at work in other countries including the United Kingdom, Japan (e.g., Kato, 2000), Denmark (e.g., Datta Gupta, & Eriksson, 2004), and Finland (e.g., Kalmi & Kauhanen, 2008). Whereas the corresponding evidence for transition economies is much slimmer, the available evidence is also suggestive that such practices are limited though spreading.¹ Unsurprisingly, both theoretical and an empirical literature have appeared to examine the impact of IWPs on both business performance and employee outcomes. As different scholars from diverse fields in the broad area of industrial relations have applied varying approaches to explore several research questions, those literatures have grown rapidly. At the same time, while it is clear that analytical work of the kind is becoming commonplace for advanced economies, work that focuses on developing and transition economies is very slim. As it is important to determine whether findings for firms in advanced market economies carry over to other economies, the first contribution of this chapter is to extend the geographical coverage of the empirical literature. This we do by assembling and analyzing new survey data set for a large Croatian manufacturing firm with our chapter perhaps representing one of the first such investigations for a former communist economy.

This chapter describes the spread of new work and pay practices in Danish private sector firms during the last two decades. The data source is two surveys directed at firms and carried out ten years apart. The descriptive analysis shows that large changes in the way work is organised in firms have occurred during both decades, whereas the progression of pay practices predominantly took place in the nineties. There is considerable firm heterogeneity in the frequency of adoption of the practices. In particular, the prevalence of both incentive pay and work practices is higher in multinational companies and firms engaged in exporting.

In a number of recent studies, it has been demonstrated that mental illness imposes real and large costs over and above the direct expenses of care and treatment. Each year in the U.S., 5–6 million workers between 16 and 54 years of age lose, fail to seek or cannot find employment as a consequence of mental illness. Among those who do work, it is estimated that mental illness decreases annual income by an amount between USD 3500 and USD 6000 (Marcotte & Wilcox-Gök, 2001). Similar results have been shown in a number of studies (Ettner et al., 1997).