A COMPARATIVE STUDY OF TRADE UNIONS : AN ECONOMIC PERSPECTIVE

Abstract

The importance of labour features predominantly in the economic successes of Hong Kong, Singapore and Japan. In view of this, a conducive industrial relations climate is inevitably a prerequisite for their pursuit of sustained economic prosperity. Owing to the broad nature of industrial relations, this thesis focuses on a salient actor in any industrial relations system - trade unions. Trade unions' role and impact were analysed in two main areas: collective bargaining and wage determination. The analysis was based on economic criterias such as implications of unionism on labour productivity, efficiency and overall economic growth. The investigation for Japan demonstrated the potential efficiency enhancing benefits that unionism entails. Trade unions' contributions to productivity stems mainly from their effectiveness in forging communications, mutual trust and co-operation between labour and management. Japanese unions' positive contributions were captured by empirical studies, such as that conducted by Muramatsu ( 1984), where a significantly positive relationship was found between unions and productivity. His findings were, however, contrary to the outcome of a similar empirical test conducted in this thesis for the case of Singapore's manufacturing. The difference in empirical test outcomes may be attributed to the relatively less favourable union-management relationship observed in the latter. As for Hong Kong, given the weak organising powers of trade unions, one may intuitively expect that unions are unlikely to have any significant contributions to productivity.

Hence, this thesis establishes the point: trade union , if given adequate influence and opportunity, has the potential to contribute favourably to a country's productivity and economic growth. The thesis therefore proposes the use of Japan's experience with unionism as a good benchmark for Hong Kong and Singapore. Valuable lessons learnt from the former promises attractive productivity-enhancing effects of trade unionism. This may however entail fundamental changes to the existing trade union movement in the latter two countries.