Greg Distelhorst
While no one advocates for labor abuses, poor working conditions are often seen as an inevitable consequence of global trade. Producers in less-developed countries compete by keeping costs low. Conventional wisdom holds that improving working conditions (which typically costs money) would undermine the competitive advantage these firms enjoy.
Our research suggests an alternative to this race to the bottom. It involves replacing traditional mass manufacturing with “lean manufacturing” principles. Over the last thirty years, the lean approach — developed by Japanese automakers — has permeated the manufacturing sector in developed countries, but is much less commonly used in the developing world.
Here’s a simplified description of the difference between the two approaches. Traditional mass manufacturing is based on principles of “Scientific Management” that date back to the 19th century. Workers specialize in simple, highly routinized operations. They are incentivized to complete operations as quickly as possible. Managers hold virtually all decision-making authority.
The article's full-text is available here.
