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Productivity and trade unions in British manufacturing industry 1973-85

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  • Kevin Denny

Abstract

This paper uses panel data on british manufacturing industries between 1973 and 1985 to examine the relationship between productivity and labour organization. It is shown that the relationship between unions and productivity levels is sensitive to the econometric specification. The evidence points to there being no relationship in the 1970s when unions were more popular and a negative relationship from 1979 onwards. We also find evidence that industrial concentration is associated with higher levels of productivity and this accounts for more of the productivity recovery after the recession in the early 1980s than the impact of trade unions. The recession itself is shown to have had an impact on subsequent productivity growth. We also suggest that the long run gains in productivity caused by the shakeout of 1980-81 may not have compensated for the loss in output at the time.

Suggested Citation

  • Kevin Denny, 1997. "Productivity and trade unions in British manufacturing industry 1973-85," Applied Economics, Taylor & Francis Journals, vol. 29(10), pages 1403-1409.
  • Handle: RePEc:taf:applec:v:29:y:1997:i:10:p:1403-1409
    DOI: 10.1080/00036849700000030
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    References listed on IDEAS

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    1. Wadhwani, S., 1989. "The Effect Of Unions On Productivity Growth, Investment And Employment: A Report On Some Recent Work," Papers 356, London School of Economics - Centre for Labour Economics.
    2. Machin, Stephen J & Wadhwani, Sushil, 1991. "The Effects of Unions on Organisational Change and Employment," Economic Journal, Royal Economic Society, vol. 101(407), pages 835-854, July.
    3. Charles Bean & James Symons, 1989. "Ten Years of Mrs. T," NBER Chapters,in: NBER Macroeconomics Annual 1989, Volume 4, pages 13-72 National Bureau of Economic Research, Inc.
    4. Muellbauer, John, 1991. "Productivity and Competitiveness," Oxford Review of Economic Policy, Oxford University Press, vol. 7(3), pages 99-117, Autumn.
    5. Denny, Kevin & Nickell, Stephen J, 1992. "Unions and Investment in British Industry," Economic Journal, Royal Economic Society, vol. 102(413), pages 874-887, July.
    6. Machin, Stephen J, 1991. "The Productivity Effects of Unionization and Firm Size in British Engineering Firms," Economica, London School of Economics and Political Science, vol. 58(232), pages 479-490, November.
    7. Muellbauer, John, 1984. "Aggregate Production Functions and Productivity Measurement: A New Look," CEPR Discussion Papers 34, C.E.P.R. Discussion Papers.
    8. Nickell, Stephen J, 1981. "Biases in Dynamic Models with Fixed Effects," Econometrica, Econometric Society, vol. 49(6), pages 1417-1426, November.
    9. Nickell, S. & Komg, P., 1989. "Technical Progress And Jobs," Papers 366, London School of Economics - Centre for Labour Economics.
    10. Manuel Arellano & Stephen Bond, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," Review of Economic Studies, Oxford University Press, vol. 58(2), pages 277-297.
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    Cited by:

    1. Monojit Chatterji, 2000. "Trade Union Power and Economic Efficiency," Dundee Discussion Papers in Economics 108, Economic Studies, University of Dundee.
    2. Dimitrios Asteriou & Vassilis Monastiriotis, 2004. "What do unions do at the large scale? Macro-economic evidence from a panel of OECD countries," Journal of Applied Economics, Universidad del CEMA, vol. 7, pages 27-46, May.

    More about this item

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects

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