Union of Parts: Labor Politics in Postwar Germany

Since the start of its economic miracle, West Germany has shown a striking ability to manage industrial adjustment peacefully and with the cooperation of organized labor. Frequently compared to smaller "corporatist" democracies such as Sweden and Austria, Germany resembles these countries in outcomes - negotiated adjustment and labor peace - but achieves them in different ways. Kathleen A. Thelen, using a case study of Germany's leading union, the IG Metall, documents how peaceful collaborative adjustment results from the interaction of centralized bargaining and decentralized labor participation through the institutions of codetermination. Thelen shows how the system of plant works councils created in the 1950s - in a form the union originally opposed - evolved into an integral part of the IG Metall's structure and strategies. Her examination of plant bargaining in three industries adversely affected by macroeconomic developments in the 1970s and 1980s - steel, automobiles, and consumer electronics - demonstrates how codetermination contributed to Germany's overall pattern of negotiated adjustment. Analyzing IG Metall's responses to the issues of unemployment and technological change, Thelen traces a shifting balance between centralized bargaining and codetermination in response to changing macroeconomic and political trends. Comparisons with Sweden and the United States highlight the distinctive features of Germany's dual system that account for its continued resiliency.