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R&D and Unionism: Comparative Evidence from British Companies and Establishments

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  • Naercio Menezes-Filho
  • David Ulph
  • John Van Reenen

Abstract

U.S. research has found that unionization adversely affects research and development investment, consistent with the view that labor unions' rent-seeking activities act as a tax on innovation. In this U.K. study, preliminary analysis of two datasets (a cross-section of plants and a company panel for the years 1983–90) shows the same negative correlation. This correlation completely disappears, however, when controls are included for such factors as cohort effects and the availability of innovative technology in the industry. Moreover, R&D intensity appears to have been higher in enterprises where there were low levels of union density than in those where there was no union presence. Some evidence suggests that the difference between U.K and U.S. results may be due to cross-country differences in the prioritization of non-pay issues in bargaining.

Suggested Citation

  • Naercio Menezes-Filho & David Ulph & John Van Reenen, 1998. "R&D and Unionism: Comparative Evidence from British Companies and Establishments," ILR Review, Cornell University, ILR School, vol. 52(1), pages 45-63, October.
  • Handle: RePEc:sae:ilrrev:v:52:y:1998:i:1:p:45-63
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    Cited by:

    1. Tapio Palokangas, 2008. "Economic Integration, Lobbying by Firms and Workers, and Technological Change," DEGIT Conference Papers c013_003, DEGIT, Dynamics, Economic Growth, and International Trade.
    2. Hristos Doucouliagos & Patrice Laroche, 2013. "Unions and Innovation: New Insights From the Cross-Country Evidence," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 52(2), pages 467-491, April.
    3. Stephen Bond & Dietmar Harhoff & John Van Reenen, 2010. "Investment, R&D and Financial Constraints in Britain and Germany," NBER Chapters,in: Contributions in Memory of Zvi Griliches, pages 433-460 National Bureau of Economic Research, Inc.
    4. Naercio Menezes-Filho & Helio Zylberstajn & Jose Paulo Chahad & Elaine Pazello, 2002. "Unions and the Economic Performanceof Brazilian Establishments," Research Department Publications 3157, Inter-American Development Bank, Research Department.
    5. Addison, John T. & Heywood, John S. & Wei, Xiangdong, 2001. "Unions and Plant Closings in Britain: New Evidence from the 1990/98 WERS," IZA Discussion Papers 352, Institute for the Study of Labor (IZA).
    6. Palokangas, Tapio K., 2005. "Economic Integration, Market Power and Technological Change," IZA Discussion Papers 1592, Institute for the Study of Labor (IZA).
    7. Davide Antonioli & Massimiliano Mazzanti, 2009. "Techno-organisational strategies, environmental innovations and economic performances. Micro-evidence from an SME-based industrial district," Journal of Innovation Economics, De Boeck Université, vol. 0(1), pages 145-168.
    8. Addison, John T., 2005. "The Determinants of Firm Performance: Unions, Works Councils, and Employee Involvement/High Performance Work Practices," IZA Discussion Papers 1620, Institute for the Study of Labor (IZA).
    9. John Van Reenen, 2001. "The new economy: reality and policy," Fiscal Studies, Institute for Fiscal Studies, vol. 22(3), pages 307-336, September.

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