In this booklet, one of a series intended to apply economic principles to major social and political issues of the day, it is argued that government regulation of business has produced disappointing results, as evidenced by the steady rise of inflation rates in the 1970's, continuing unemployment, declining labor productivity, and increases in taxes and welfare payments. Despite these failures to accelerate economic growth, proponents of government interventionism are offering a new set of government controls known as national industrial policy. Yet industrial democracy (labor participation in decision making) is inconsistent with the requirements of economic efficiency and labor participation weakens the right of ownership and causes corporate decisions to become politicized. The booklet presents brief subsections outlining three different levels of labor participation in decision making, philosophical foundations of labor participation, labor participation plans in four countries (West Germany, Norway, Ireland, and the United States), the pros and cons of industrial democracy, social consequences of labor participation, and results of codetermination in Western Europe. (LH)