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Employment, Innovation and Union Bargaining Models: New Tests and Evidence from UK Manufacturing Firms

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  • Van Reenen, John

Abstract

This paper investigates the impact of innovation on employment using a panel of UK manufacturing firms and a headcount measure of innovations. It focuses on unionized firms and outlines a methodology for testing between various types of union bargaining models. It also argues that the innovation effect can be used to distinguish between shirking models and union bargains. Innovation is found to have positive effect on company employment raising it by 9--12% in the short run and up to 40% in the long run. Furthermore, although the data cannot reject a labour demand model, firms with stronger unions have higher employment growth from new products and processes.

Suggested Citation

  • Van Reenen, John, 1994. "Employment, Innovation and Union Bargaining Models: New Tests and Evidence from UK Manufacturing Firms," CEPR Discussion Papers 874, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:874
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    Citations

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    Cited by:

    1. Alyan, Nafez, 1999. "Technology and the US labor market: Evidence from the sectoral and regional decomposition of the change in the US workforce skill mix," Economics Letters, Elsevier, vol. 63(1), pages 111-118, April.
    2. Pfeiffer, Friedhelm & Brade, Joachim, 1995. "Weiterbildung, Arbeitszeit und Lohneinkommen," ZEW Discussion Papers 95-14, ZEW - Leibniz Centre for European Economic Research.
    3. Martin Falk & Hannes Leo, 2004. "Die Innovationsaktivitäten der österreichischen Unternehmen. Empirische Analysen auf Basis der Europäischen Innovationserhebung 1996 und 2000," WIFO Studies, WIFO, number 25249, February.

    More about this item

    Keywords

    Employment; Innovation; Panel Data; Union Bargaining;
    All these keywords.

    JEL classification:

    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives

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