Abstract
This chapter introduces the argument and situates it within existing debates. In doing so, it takes an interdisciplinary approach and combines insights from the writings of Karl Marx with those from an institutionalist, political economy perspective. Specifically, the chapter makes two key contributions. First, the discussion reveals how vocational training and education policy has turned into a major instrument for controlling labor unrest in the Global South. Second, it argues that the organization of political power plays a key role in this process. In developing these points, the chapter presents an overview of the conflict instigated by new production technologies in developing settings and reviews what is at stake. After briefly explaining the logic of case selection and the methodology, it concludes by presenting an outline of the book.
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Notes
- 1.
Lean production techniques seek to maximize efficiency by reducing waste/externalities in the production process.
- 2.
Labor turnover rate is measured by dividing the number of employers who left their position in a given year by the average number of employees per year. A high turnover rate signals problems with retaining skills and efficiency in production (Glebbeek and Bax 2004).
- 3.
Active industrial policy in developing economies is characterized by a close partnership between business and the government, where “the former needs to be highly transparent and willing to share information on a regular basis and the government introduces incentive schemes and performance standards to improve industrial output and efficiency ” (Schneider 2015, 11).
- 4.
In fact, intervention on behalf of capitalists is what Marx would expect to observe even under a Bonapartist state, where he grants it some autonomy and situates it somewhat above the direct control of the dominant class. See Miliband 1965.
- 5.
For a recent exception, see Yeldan 1995.
- 6.
Arguably, Brazil is a partial exception to this pattern. There, the firms were able to exploit Fordist opportunities in a relatively large domestic market, together with the help of state institutions. See Evans 1995.
- 7.
These means include, but not limited to, restriction of labor rights, squeezing wages, banning strikes and repeated attacks on organized labor groups.
- 8.
See Article 17 of the Labor Law No. 1475 in Turkey .
- 9.
It must be noted that surplus extraction across a given industry is relative: the rate of surplus extraction is not the same when a large corporation reaps the larger share, accumulating “super-profits” while others—such as second tier parts suppliers which I briefly discuss in Chap. 2—are unable to do the same.
- 10.
See Marx (1990 [1976]), pp. 320–329 for a discussion on the creation of surplus value. According to Marx, there are two main forms of surplus extraction: absolute and relative. Absolute surplus value refers to extra value that is generated by increasing the hours worked per working day. On the other hand, relative surplus value is generated by “cutting down wages and [thereby]…reducing the necessary labor time in proportion to the surplus labor time” (http://www.marxists.org/encyclopedia/terms/a/b.htm#absolute), accessed on 10 October 2009. Other strategies include techniques of immiseration (i.e. pushing wages down) and super-exploitation (e.g. paying wages below subsistence requirements) (Selwyn 2014). Yeldan (1995) suggests that these coercive aspects better characterize surplus extraction techniques in developing economies given active involvement of the state.
- 11.
According to Marx, there are at least three ways in which capital accumulation occurs: first is primitive accumulation through appropriating resources (i.e. land, goods), second by the appropriation of extra value created by the worker, and third is through exchange of goods in trade.
- 12.
Even though surplus labor extraction is a fundamental component of capital accumulation, it is not the only mechanism that sustains it. As much as capital accumulation depends on the surplus value appropriated from the worker, it also needs new markets for consumption, trading goods and reinvesting capital. We can best imagine this process through a symbolic scale with two legs: market creation and value extraction. Capitalist crises are more likely to erupt when the balance is tipped toward either side. In addition to negotiating the terms of domestic market interactions, advanced industrialized countries also strive to create new trade prospects by facilitating access to export markets for domestic firms. In this way, politicians play a key role in fine-tuning capital accumulation mechanisms not only by institutionalizing surplus labor extraction methods, but also by enabling firm access to new markets. Together with supporting market institutions (i.e. labor law, anti-trust laws, welfare measures) state and social actors seek to prevent crises (i.e. sharp rise in unemployment , inflation, market failure) from fundamentally disrupting capital accumulation—an important lesson learned after the US market crash in 1929 (Jessop 2002, 61).
- 13.
While some students of Marx suggest that capitalism is bounded by the falling rate of profit, more recent accounts suggest that Marx did not make such an ambitious claim (see Harvey 2016). As it stands, there is very little empirical evidence that singles out falling rate of profit as the sure-cause behind crises of capitalism (Harvey 2016, 39–43). While it is true that rate of capital accumulation slows down at times of a major meltdown, technological innovations that involve greater use of labor in relation to capital—once they become widespread in use—could sustain productivity (Marx quoted in Harvey 2016, 42). For example, data from the US Bureau of Labor Statistics reveal that the output per worker in the manufacturing industry has been consistently on the rise, except for periods of recession (see https://data.bls.gov/pdq/SurveyOutputServlet). Research on the Japanese automobile industry similarly shows that productivity has grown rapidly beginning from as early as the 1960s. See for example, https://sloanreview.mit.edu/article/manufacturing-innovation-lessons-from-the-japanese-auto-industry/. In both settings, the rate of wage increases was much slower compared with the rate of increase in productivity. While increasing productivity is not necessarily the best measure of surplus extraction , at the heart of Toyotism sits a dedicated and docile worker who is expected to prioritize the company’s performance and work without a (fair) compensation if necessary. The fact that the rate of wage increase falls below the rate of output per worker provides suggestive evidence on how the rate of surplus extraction has increased over time.
- 14.
Nevertheless, that does not mean training was completely neglected by governments under Fordism . The more the workers are trained, the higher the efficiency would be (i.e. the risks for workplace accidents are reduced, and probability of faulty production is minimized). Thus, exposing workers to vocational education and training programs not only facilitates specialization but also enables faster surplus labor extraction by minimizing the costs through ensuring the efficient use of manual labor.
- 15.
Some scholars imply that post-Fordism essentially marks the beginnings of a post-materialist era in production. For example, Hardt and Negri (2001, 2005) and Lazzarato (1996) from the post-modern school note that the significance of manual labor has been in decline especially with increasing automation and use of computerized systems. According to this school, immaterial labor is the new defining feature of our times. Immaterial labor is defined as a specific form that does not require the use of manual power in production; rather, it is characterized by the use of a different type of physical power (i.e. mental thinking, intellectual activities) that yield products that are immaterial in character (e.g. information, services). Taking a bolder step, Hardt and Negri give car production as an example to the gradual disappearance of manual labor with the increasing use of machinery on the shopfloor . As we shall see, this observation is not very accurate in developing contexts. There, the use of manual labor is highly prevalent in the manufacturing industry and most importantly, in high-value-added sectors—such as automobiles—production runs on a combination of automation and manual labor. Long before Hardt and Negri’s work appeared on the horizon, Hirst and Zeitlin (1992) complained about oversimplified depictions of transition from Fordism to post-Fordism as an exclusively market and technology driven process—at least in the context of advanced industrialized countries. In a famous essay published in Economy and Society, these authors are highly critical of the “technological determinism” adopted by many scholars, including Marxists, and propose that the reality involves a great deal of complexity, with hybrid models adopted by different firms, sectors and national economies. Nevertheless, unlike advanced industrialized settings where the pace of technological change in the automobile industry was more gradual, producers in the Global South —mostly local subsidiaries of global MNCs —rapidly had to introduce standardized business plans drafted in company headquarters elsewhere. Importantly, these processes were bounded by the institutional context in which they unfolded.
- 16.
In his classical 1962 article, Becker defined investment in human capital as “activities that influence the future real income through the imbedding of resources in real people ” (Becker 1962, 9).
- 17.
According to most economists, individuals seek to maximize their material well-being (or utility) in economic transactions; they possess full knowledge of market conditions; and they act rationally to achieve their preferences in the light of this knowledge (Martinelli and Smelser 1990, 29).
- 18.
- 19.
For example, some companies and big holdings emphasize flexibility so much so that they shift groups of workers employed in different sub-sectors when there are severe external shocks. For example, Koc Holding in Turkey shifted a group of workers from their Ford Factory, which produces cars, to Arcelik LG (owned by the same group), which produces air conditioning equipment (“Ford Iscileri Arcelik LG’de calisacak” (Ford workers will be employed at Arcelik LG), Sabah, 9 April 2009. Available at: http://www.sabah.com.tr/2009/04/09/haber,EFC9FA8ADE4941888093A0DA31A1844A.html, accessed on 1 May 2009)
- 20.
Some studies with a neo-Marxist perspective take this assumption further and argue that vocational education is a “class-based solution invented by capitalist businessmen and industrial managers to consolidate their power over the emerging corporate capitalist economies” (Spring 1972; Violas 1978 quoted in Benavot 1983). Based on this framework , Braverman (1974) implies that new vocational training programs disempowered the working class and left it without control over skill formation systems. These scholars claim that the learning capacity of individuals—which is generally taken as a given by the economists—is actually shaped by the class relations and relative access to resources. One of the earliest studies in this framework by Boudon (1974) suggests that there are two types of social effects that influence skill development: primary and secondary effects. Primary effects are environmental stimuli that shape cognitive abilities and learning motivation in children conditioned by different class backgrounds (Müller and Jacob 2008, 130). Relatedly, secondary effects include “class differences in the choices individuals make in their educational careers, given the same performance in schools” (Müller and Jacob 2008, 130). Boudon argues that primary and secondary effects accumulate over time, sharpening class-based inequalities as the level of education increases. Yet, these studies remain quiet on how differences in the skill composition due to class-based inequalities aggregate and translate into national and/or cross-national variation in the skill formation systems.
- 21.
Rothstein looks at a particular shopfloor policy (e.g. Andon system) that requires the use of manual labor by the workers, and excludes a broader focus on intellectual participation schemes, which follow relatively standardized managerial control systems. Andon system is a practice by which workers could stop the assembly- line during production to address problems to guarantee quality (Rothstein 2006, 153). On a related note, this practice was no longer in use at FIAT factories due to time loss and delays in meeting production deadlines.
- 22.
According to Iversen and Soskice (2001), partisan composition of governing coalitions is critical for understanding redistribution policy. A government’s approach to redistribution is highly likely to shape the skill formation system to be endorsed by the ruling coalition. Because electoral systems play an important role in deciding on the political composition of the executive, they are the key to understanding whether the government will channel large sums of money into public vocational education and training programs.
- 23.
This is a Europe-based automobile corporation that specializes in cars for the middle income group.
- 24.
These provinces are Minas Gerais-Betim (Brazil); Minas Gerais-Sete Lagoas (Brazil); Córdoba (Argentina ); Bursa (Turkey ).
- 25.
This includes Sete Lagoas (Brazil) established in 2000.
- 26.
- 27.
For an overview of subnational comparative methods, see Snyder 2001. Recent political analyses that apply subnational methods to analyze empirical evidence from federal systems include Gibson and Calvo 2000; Heller 2000; Varshney 2001; Snyder 2001; Jones Luong 2002; Chavez 2003; Wibbels 2005; Hiskey 2005; Calvo and Micozzi 2005; Hecock 2006; Urdal 2008; Weitz-Shapiro 2014. For recent examples of subnational comparisons based on single non-federal systems see Putnam et al. 1993; Locke 1997; Moncada 2009.
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Apaydin, F. (2018). Introduction: The Politics of Changing Hearts and Minds. In: Technology, Institutions and Labor. International Political Economy Series. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-77104-5_1
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