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Chapter 24 The New Economy and the Organization of Work Although considerable research has focused on the role of investments in information and communication technologies in the “new economy,” this chapter argues that an additional component of the new economy includes changes in workplace practices. Over the past decade, more firms have adopted “knowledge-based” work processes in which nonmanagerial workers are involved in problem solving and identifying opportunities for innovation and growth. Workplace innovations such as teamwork, incentive-based compensation, employee participation in decision making, and training have raised the productive capacity of firms, impacted the wages of workers, and affected the demand for skilled labor. This chapter summarizes the empirical evidence on the impact of workplace innovation on the new economy and the implications for public policy. |