The dynamic effects of works councils on labor productivity

Abstract

We estimate dynamic effects of works councils on labor productivity using newly available information from West German establishment panel data. Conditioning on plant fixed effects and control variables, we find negative productivity effects during the first five years after council introduction but a steady and substantial increase in the councils' productivity effect thereafter. We interpret the latter as evidence for a positive causal effect of works councils on labor productivity.

Cite article

Müller, S. & Stegmaier, J. (2014): The dynamic effects of works councils on labor productivity. First evidence from panel data. (LASER discussion papers 78), Erlangen, 28 p.