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What Do Japanese Unions Do for Productivity?: An Empirical Analysis Using Firm-Level Data

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Author Info
MORIKAWA Masayuki
Abstract

This paper empirically analyzes the relationship between union presence and firm performance in areas such as productivity and profitability by using data on a large number of Japanese firms, covering both manufacturing and non-manufacturing industries. Results indicate that the presence of labor unions has large positive effects on productivity level and growth. The effects of union presence on wages are also positive and the magnitude is similar to that of productivity. I find no negative effect for the presence of unions on firm profitability. These results differ from studies in the U.S. The number of employees decreases more for unionized firms than non-unionized firms. Most of the difference in employment is attributable to the change in the number of part-time workers. In order to enhance the productivity of the service sector, close cooperation between management and unions is required.

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Paper provided by Research Institute of Economy, Trade and Industry (RIETI) in its series Discussion papers with number 08027.

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Length: 16 pages
Date of creation: Jul 2008
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Handle: RePEc:eti:dpaper:08027

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Laroche, P., 2000. "What do Unions do to Productivity? A Meta-Analysis," Papers 2000-5, Groupe de recherche en économie financière et en gestion des entreprises, Universite Nancy 2.
  2. Hirsch, Barry T., 2003. "What Do Unions Do for Economic Performance?," IZA Discussion Papers 892, Institute for the Study of Labor (IZA). [Downloadable!]
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  3. Addison, John T & Hirsch, Barry T, 1989. "Union Effects on Productivity, Profits, and Growth: Has the Long Run Arrived?," Journal of Labor Economics, University of Chicago Press, vol. 7(1), pages 72-105, January. [Downloadable!] (restricted)
  4. David G. Blanchflower & Alex Bryson, 2003. "What Effect do Unions Have on Wages Now and Would 'What Do Unions Do' Be Surprised?," NBER Working Papers 9973, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  5. Giorgio Brunello, 1992. "The effect of unions on firm performance in Japanese manufacturing," Industrial and Labor Relations Review, ILR Review, ILR School, Cornell University, vol. 45(3), pages 471-487, April.
  6. Kyoji Fukao & Hyeog Ug Kwon, 2004. "Why Did Japan's TFP Growth Slow Down in the Lost Decade?: An Empirical Analysis Based on Firm-Level Data of Manufacturing Firms," Hi-Stat Discussion Paper Series d04-50, Institute of Economic Research, Hitotsubashi University. [Downloadable!]
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  7. Victor R. Fuchs & Alan B. Krueger & James M. Poterba, 1998. "Economists' Views about Parameters, Values, and Policies: Survey Results in Labor and Public Economics," Journal of Economic Literature, American Economic Association, vol. 36(3), pages 1387-1425, September. [Downloadable!] (restricted)
  8. Brown, Charles & Medoff, James, 1978. "Trade Unions in the Production Process," Journal of Political Economy, University of Chicago Press, vol. 86(3), pages 355-78, June. [Downloadable!] (restricted)
  9. Nick Bloom & John Van Reenen, 2006. "Measuring and Explaining Management Practices Across Firms and Countries," CEP Discussion Papers dp0716, Centre for Economic Performance, LSE. [Downloadable!]
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  10. Casey Ichniowski & Kathryn Shaw, 2003. "Beyond Incentive Pay: Insiders' Estimates of the Value of Complementary Human Resource Management Practices," Journal of Economic Perspectives, American Economic Association, vol. 17(1), pages 155-180, Winter. [Downloadable!] (restricted)
  11. Barry T. Hirsch, 2008. "Sluggish Institutions in a Dynamic World: Can Unions and Industrial Competition Coexist?," Journal of Economic Perspectives, American Economic Association, vol. 22(1), pages 153-176, Winter.
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  12. Aw, Bee Yan & Chen, Xiaomin & Roberts, Mark J., 2001. "Firm-level evidence on productivity differentials and turnover in Taiwanese manufacturing," Journal of Development Economics, Elsevier, vol. 66(1), pages 51-86, October. [Downloadable!] (restricted)
  13. Stephen Machin & Stephen Wood, 2005. "Human resource management as a substitute for trade unions in British workplaces," Industrial and Labor Relations Review, ILR Review, ILR School, Cornell University, vol. 58(2), pages 201-218, January. [Downloadable!] (restricted)
  14. David Blanchflower & Alex Bryson, 2002. "Changes over time in union relative wage effects in the UK and the US revisited," NBER Working Papers 9395, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  1. Fujiwara, Yoshi & Iyetomi, Hiroshi & Ikeda, Yuichi & Souma, Wataru, 2009. "Distribution of Labour Productivity in Japan over the Period 1996?-2006," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy, vol. 3(14), pages 1-14. [Downloadable!]
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