Equality, Participation, Transition: Essays in Honour of Branko Horvat

92 Employee Participation in Enterprise Control and Returns
labour, in which case the possibility of employee exploitation of
other shareholders arises (a possibility which lies outside the Ben-
Ner and Jones framework).
4 Some combinations of the two forms of participation are shown to
be impossible or at any rate unstable, such as dominant control
without profit participation, or substantial participation in returns
without substantial control rights.
5 James Meade’s (1993) Agathotopian model is included in the
taxonomy.
Classification discontinuities and gaps are revealed by this approach.
These are shown to have significant implications for the impact of participation
on productivity and other aspects of enterprise performance.
The case for public policy support for participation is accordingly
much weakened, if not altogether destroyed.
6.2 Employee participation: the standard framework
In a conventional capitalist enterprise all rights to entrepreneurial control
and returns belong to the firm’s owner or owners, or to shareholders
in the case of a joint-stock company. Departures from this benchmark, in
the guise of various degrees of employee participation in enterprise control
and/or returns, occur frequently for different reasons, such as paternalism,
profit maximization especially in the long run, inducements or
obligations set by public policy. Traditional taxonomy of enterprise types
according to degrees of employee participation envisages a continuous
field of variation for both forms of participation in control and/or
returns. In its most developed form, this approach is exemplified by the
work of Ben-Ner and Jones (1995), who use it as a theoretical framework
to investigate the continuous (though not necessarily monotonic)
impact of both forms of participation on labour productivity.
Ben-Ner and Jones place types of enterprises on a grid by increasing
degrees of participation (see Table 6.1). Their grid is limited to a 4x4 size
only by practical constraints; employees’ control rights go from zero
to participation in control, sharing of control, and dominant control;
return rights go from zero to small, moderate and majority degrees.
However, the idea is that of a continuous spectrum of actual or possible
enterprises graded by the intensity of both participation forms. Ben-Ner
and Jones (1995) distinguish between participation’s impact on individual
and on organizational productivity – a distinction which we neglect
here in looking at the overall impact regardless of sources.