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New Workplace Practices and Firm Performance: A Comparative Study of Italy and Britain

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Author Info
Cristini, Annalisa () (Department of Economics)
Pozzoli, Dario () (Department of Economics, Aarhus School of Business)

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Abstract

Using data from the 2004 Workplace Employee Relations Survey on British establishments and two surveys on manufacturing firms located in the North of Italy, we look at the diffusion of new workplace practices in the two countries and at their impact on the firm's value added. We find that the adoption of innovation practices has spread substantially more across the British manufacturing firms than across the Italian ones; however our results also indicate that the practices' association with the firms' VA is much lower in Britain than in Italy. The counterfactual analysis shows that had the Italian workplaces the same characteristics of the British ones, in terms of diffusion of practices, capital intensity and skills, their average predicted value added would triplicate. On the other hand, were the Italian establishments to move and operate in the British context, their performance would improve very modestly. For the British establishments, we also investigate whether management practices improve job satisfaction.

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Publisher Info
Paper provided by University of Aarhus, Aarhus School of Business, Department of Economics in its series Working Papers with number 08-9.

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Length: 47 pages
Date of creation: 01 May 2008
Date of revision:
Handle: RePEc:hhs:aareco:2008_009

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Postal: The Aarhus School of Business, Prismet, Silkeborgvej 2, DK 8000 Aarhus C, Denmark
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Related research
Keywords: Workplace practices; Financial Performance; Italy; UK;

Find related papers by JEL classification:
C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data
J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts
J53 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Labor-Management Relations; Industrial Jurisprudence
L20 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - General

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References listed on IDEAS
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  1. Alex Bryson & John Forth & Simon Kirby, 2005. "High-Involvement Management Practices, Trade Union Representation And Workplace Performance In Britain," Scottish Journal of Political Economy, Scottish Economic Society, vol. 52(3), pages 451-491, 07. [Downloadable!] (restricted)
  2. Sandra E. Black & Lisa M. Lynch, 2000. "What's Driving the New Economy: The Benefits of Workplace Innovation," NBER Working Papers 7479, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  3. Bertola, Giuseppe, 1990. "Job security, employment and wages," European Economic Review, Elsevier, vol. 34(4), pages 851-879, June. [Downloadable!] (restricted)
  4. Lazear, Edward P, 1990. "Job Security Provisions and Employment," The Quarterly Journal of Economics, MIT Press, vol. 105(3), pages 699-726, August. [Downloadable!] (restricted)
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  6. Paul Osterman, 1994. "How common is workplace transformation and who adopts it?," Industrial and Labor Relations Review, ILR Review, ILR School, Cornell University, vol. 47(2), pages 173-188, January.
  7. Giuseppe Nicoletti & Stefano Scarpetta & Olivier Boylaud, 2000. "Summary Indicators of Product Market Regulation with an Extension to Employment Protection Legislation," OECD Economics Department Working Papers 226, OECD, Economics Department. [Downloadable!]
  8. Sandra E. Black & Lisa M. Lynch, 2001. "How To Compete: The Impact Of Workplace Practices And Information Technology On Productivity," The Review of Economics and Statistics, MIT Press, vol. 83(3), pages 434-445, August. [Downloadable!] (restricted)
    Other versions:
  9. Simeon Djankov & Rafael La Porta & Florencio Lopez-De-Silanes & Andrei Shleifer, 2002. "The Regulation Of Entry," The Quarterly Journal of Economics, MIT Press, vol. 117(1), pages 1-37, February. [Downloadable!] (restricted)
    Other versions:
  10. Clark, Andrew E., 1997. "Job satisfaction and gender: Why are women so happy at work?," Labour Economics, Elsevier, vol. 4(4), pages 341-372, December. [Downloadable!] (restricted)
    Other versions:
  11. Groot, Wim & Maassen van den Brink, Henriette, 1999. "Job satisfaction and preference drift1," Economics Letters, Elsevier, vol. 63(3), pages 363-367, June. [Downloadable!] (restricted)
  12. Nick Bloom & John Van Reenen, 2006. "Management Practices, Work--L ife Balance, and Productivity: A Review of Some Recent Evidence," Oxford Review of Economic Policy, Oxford University Press, vol. 22(4), pages 457-482, Winter.
  13. Richard B. Freeman & Morris M. Kleiner, 2000. "Who Benefits Most from Employee Involvement: Firms or Workers?," American Economic Review, American Economic Association, vol. 90(2), pages 219-223, May. [Downloadable!] (restricted)
  14. Keith A. Bender & John S. Heywood, 2006. "Job Satisfaction Of The Highly Educated: The Role Of Gender, Academic Tenure, And Earnings," Scottish Journal of Political Economy, Scottish Economic Society, vol. 53(2), pages 253-279, 05. [Downloadable!] (restricted)
  15. Jeffrey B. Arthur, 1992. "The link between business strategy and industrial relations systems in American steel minimills," Industrial and Labor Relations Review, ILR Review, ILR School, Cornell University, vol. 45(3), pages 488-506, April.
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