Bargaining Responses to the Technology Revolution

The Case of the Newspaper Industry

by James N. Dertouzos, Timothy H. Quinn

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This report documents the results of research on how the bargaining relationship between workers and firm managers affects the introduction of new technologies. Using data from the newspaper industry, the research documents the extent of technology diffusion and labor displacement, and explains why firms and workers under varying circumstances rely on different bargaining responses to incorporate new technologies into production processes. The following are among the main empirical results: (1) worker layoffs are rare; (2) nonunion firms are no less likely to compensate workers than union firms; (3) the most frequently observed bargaining response is natural attrition; (4) nonunion firms exhibit greater reliance on programs to retrain workers for other jobs in the firm; and (5) group-owned newspapers did not adopt the new technology more quickly. Other characteristics with predictable effects on response decisions quantified in this report include the size of the firm, market growth, whether the firm was purchased near the time of technology adoption, and the age distribution of workers.

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