Labour relations quality and productivity : An empirical analysis on French firms
AbstractThis analysis characterizes empirically how good labour relations can alleviate the negative impact on productivity of regulatory constraints or workforce opposition. Our evidence of good labour relations lies in the existence of binding collective agreements, at the firm or at the industry level. The estimations are based on a unique dataset collected by the Banque de France about the obstacles French firms may face in increasing their utilisation of production factors. Data are an unbalanced sample of 7,441 observations, corresponding to 1,545 companies, over the period 1991-2008. Our main results may be summarised as follows : i) 'workforce or union opposition' interacted with 'regulatory constraints' has a negative significant impact on total factor productivity (TFP). Regulatory constraints would become really binding when workers or unions use them as a tool to oppose management's decisions ; ii) 'regulatory constraints' interacted with 'branch or firm agreement' has a positive significant impact on TFP. These agreements, which can only be obtained if labour relations are supportive, would be used by firms to offset the negative impact of regulatory constraints. These results confirm that labour relations quality, at the branch or the firm levels, is an important factor of productive performance.
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Date of creation: Jul 2012
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Labour relation; collective bargaining; trade unions; productivity;
Other versions of this item:
- Gilbert Cette & Nicolas Dromel & Rémy Lecat, 2013. "Labour Relations Quality and Productivity: An Empirical Analysis on French Firms," Review of Economics and Institutions, Università di Perugia, vol. 4(2).
- Cette, G. & Dromel, N. & Lecat, R. & Paret, A-C., 2012. "Labour relations quality and productivity: An empirical analysis on French firms," Working papers 389, Banque de France.
- Gilbert Cette & Nicolas Dromel & Rémy Lecat & Anne-Charlotte Paret, 2012. "Labour relations quality and productivity: An empirical analysis on French firms," Documents de travail du Centre d'Economie de la Sorbonne 12052, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
- J53 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Labor-Management Relations; Industrial Jurisprudence
- J52 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Dispute Resolution: Strikes, Arbitration, and Mediation
- J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
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