Downsizing in America: Reality, Causes, and Consequences

This fact-filled book is a serious, comprehensive, and dispassionate treatment of a hard reality. The authors—Baumol and Wolff are at New York University, Blinder at Princeton—set out to investigate six common ideas about downsizing. They debunk a number of myths, but some of their findings may also be grimly familiar to readers: among them, "...downsizing is profitable at least partly because it is an effective way to hold down wages. We may be led to say this is the dirty little secret of downsizing." Their main focus is to answer three questions: To what extent have firms really tended to downsize? What have been the consequences of the downsizing that has taken place? And, what has determined the changes in firm size? Problems of unemployment seem here to stay. This book offers a valuable way to sort myth from fact.