The literature remains disappointingly vague when it comes to explaining how and why employee involvement has beneficial results. At the risk of being flippant, one can summarize much of the literature as follows: Participating employees are happy employees and happy employees are productive employees. Ergo, participating employees are productive employees. Unfortunately for the conventionally wise, the evidence simply does not support this claim. To be sure, there is some evidence that participatory management has positive productivity effects. But the evidence is highly tenuous and far from conclusive. Lots of interesting questions are still unanswered by any study, let alone a methodologically sound one. As to those questions that have been addressed, studies differ radically in their specification and measurement of dependent and independent variables. Methodologies differ widely ranging from collections of anecdotes that scarcely rise above the level of testimonial to rigorous econometric studies. Even as to methodologically rigorous studies, there is good reason to doubt the quality of the data sets. Failures tend to be under-reported. Hidden costs are ignored. Many data sets are inherently subject to a selection bias to the extent that they focus on firms that have adopted participatory management. Such firms are a self-selected group, whose predispositions may affect the success of participatory management.

John Cotton's "Employee Involvement" is a comprehensive review of the literature that is fair, intellectually rigorous and honest. Cotton summarizes the empirical work through the mid-1990s as reaching conclusions that are all over the map, ranging from finding no benefit to inconclusive results to finding substantial gains. Usefully, while he provides an overview of the entire field, Cotton focuses his analysis by dividing the universe of employee involvement programs into 7 distinct forms. Each form is described, both generically and with an illustrative anecdotal example, which is followed by a careful summary of the empirical literature. In the last chapter, Cotton draws some appropriately cautious conclusions. One conclusion that I think is indisputable is the importance of firm culture. Employee involvement programs vary a lot, and a key determinant of their success is the culture of the firm. Neither firms nor workers are homogeneous and programs that work well for one will flop at another. Because managers often approach employee involvement programs the way teenagers approach the latest fad, Cotton's analysis provides a useful cautionary tale.