Question

There are two main organising approaches to industrial economics. Identify these two approaches and explain how they differ.

Answer 1

The two main organizing approaches to industrial economics are as follows:

1) Unitary approach

2) Pluralistic approach

Differences between Unitary and Pluralistic approaches are as follows:

1) The unitary approach is based on the strong argument that there is only one source of authority i.e., the management, which owns and controls the dynamics of decision making in issues relating to negotiation and bargaining. Whereas, the pluralistic approach totally departs from the unitary approach and assumes that the organization is composed of individuals who form distinct groups with their own set of aims, objectives, leadership styles, and value propositions.

2)Under the unitary approach, industrial relations are grounded in mutual co-operation, individual treatment, team-work, and shared goals. Whereas, in pluralistic approach, individuals form distinct groups with their own set of aims, objectives, leadership styles, and value propositions.

3) Under the unitary approach, Unions co-operate with the management, and the management’s right to manage is accepted because there is no ‘we-they’ feeling.Whereas, in pluralistic approach, given that the organization is multi structured and there will be continued tension due to conflicts within and between the various sectional groups.