The Effect of Competition on Wages and Productivity: Evidence from the UK
This paper examines the impact of competition on wages and productivity using a panel data set of UK manufacturing industries over 1954-1973. The introduction of cartel law in the UK in the late 1950s caused an intensification of price competition in previously cartelized manufacturing industries, but it did not affect those industries which were not cartelized. The econometric results from a comparison of the two groups of industries before and after the introduction of cartel law provide strong evidence of a negative effect of collusion on labour productivity growth. There is no evidence of any effect of collusion on wages. These results are robust to controlling for the potential endogeneity of collusion and are further strengthened by a comparison with US data.
|Date of creation:||02 Mar 2007|
|Date of revision:|
|Contact details of provider:|| Postal: |
Web page: http://www.essex.ac.uk/economics/
More information through EDIRC
|Order Information:|| Postal: Discussion Papers Administrator, Department of Economics, University of Essex, Wivenhoe Park, Colchester CO4 3SQ, U.K.|
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.:
- Richard Disney & Jonathan Haskel & Ylva Heden, 2003.
"Restructuring and productivity growth in uk manufacturing,"
Royal Economic Society, vol. 113(489), pages 666-694, 07.
- Disney, Richard F & Haskel, Jonathan & Heden, Ylva, 2000. "Restructuring And Productivity Growth In UK Manufacturing," CEPR Discussion Papers 2463, C.E.P.R. Discussion Papers.
- Hay, Donald A & Liu, Guy S, 1997. "The Efficiency of Firms: What Difference Does Competition Make?," Economic Journal, Royal Economic Society, vol. 107(442), pages 597-617, May.
- Bottasso, Anna & Sembenelli, Alessandro, 2001. "Market power, productivity and the EU Single Market Program: Evidence from a panel of Italian firms," European Economic Review, Elsevier, vol. 45(1), pages 167-186, January.
- Giuseppe Nicoletti & Stefano Scarpetta, 2003.
"Regulation, Productivity and Growth: OECD Evidence,"
OECD Economics Department Working Papers
347, OECD Publishing.
- Giuseppe Nicoletti & Stefano Scarpetta, 2003. "Regulation, productivity and growth: OECD evidence," Economic Policy, CEPR;CES;MSH, vol. 18(36), pages 9-72, 04.
- Nicoletti, Giuseppe & Scarpetta, Stefano, 2003. "Regulation, productivity, and growth : OECD evidence," Policy Research Working Paper Series 2944, The World Bank.
- Simeon Djankov & Peter Murrell, 2002.
"Enterprise Restructuring in Transition: A Quantitative Survey,"
Journal of Economic Literature,
American Economic Association, vol. 40(3), pages 739-792, September.
- Djankov, Simeon & Murrell, Peter, 2002. "Enterprise Restructuring in Transition: A Quantitative Survey," CEPR Discussion Papers 3319, C.E.P.R. Discussion Papers.
- S Broadberry & Nicholas Crafts, 1996.
"British Economic Policy and Industrial Performance in the Early Post-War Period,"
CEP Discussion Papers
dp0292, Centre for Economic Performance, LSE.
- Stephen Broadberry & Nicholas Crafts, 1996. "British economic policy and industrial performance in the early post-war period," Economic History Working Papers 20669, London School of Economics and Political Science, Department of Economic History.
- Rachel Griffith, 2001. "Product market competition, efficiency and agency costs: an empirical analysis," IFS Working Papers W01/12, Institute for Fiscal Studies.
- repec:sae:niesru:v:97:y:1981:i:1:p:83-83 is not listed on IDEAS
- James A. Schmitz, Jr., 2005.
"What determines productivity? lessons from the dramatic recovery of the U.S. and Canadian iron-ore industries following their early 1980s crisis,"
286, Federal Reserve Bank of Minneapolis.
- James A. Schmitz Jr., 2005. "What Determines Productivity? Lessons from the Dramatic Recovery of the U.S. and Canadian Iron Ore Industries Following Their Early 1980s Crisis," Journal of Political Economy, University of Chicago Press, vol. 113(3), pages 582-625, June.
- repec:cup:cbooks:9780521453455 is not listed on IDEAS
- Nickell, Stephen J, 1996.
"Competition and Corporate Performance,"
Journal of Political Economy,
University of Chicago Press, vol. 104(4), pages 724-46, August.
- Symeonidis, George, 2000.
"Price Competition and Market Structure: The Impact of Cartel Policy on Concentration in the UK,"
Journal of Industrial Economics,
Wiley Blackwell, vol. 48(1), pages 1-26, March.
- Symeonidis, George, 1999. "Price Competition and Market Structure: The Impact of Cartel Policy on Concentration in the UK," CEPR Discussion Papers 2308, C.E.P.R. Discussion Papers.
- Jose E. Galdon-Sanchez & James A. Schmitz, Jr., 2003.
"Competitive pressure and labor productivity: world iron ore markets in the 1980s,"
Federal Reserve Bank of Minneapolis, issue Spr, pages 9-23.
- José E. Galdón-Sánchez & James A. Schmitz Jr., 2002. "Competitive Pressure and Labor Productivity: World Iron-Ore Markets in the 1980's," American Economic Review, American Economic Association, vol. 92(4), pages 1222-1235, September.
- George Symeonidis, 2003. "In Which Industries is Collusion More Likely? Evidence from the UK," Journal of Industrial Economics, Wiley Blackwell, vol. 51(1), pages 45-74, 03.
- repec:cup:cbooks:9780521771337 is not listed on IDEAS
- Dowrick, Steve, 1989. "Union-Oligopoly Bargaining," Economic Journal, Royal Economic Society, vol. 99(398), pages 1123-42, December.
- Symeonidis, George, 2000. "Price Competition, Non-price Competition and the Market Structure: Theory and Evidence from the UK," Economica, London School of Economics and Political Science, vol. 67(267), pages 437-56, August.
- S. Baranzoni & P. Bianchi & L. Lambertini, 2000. "Market Structure," Working Papers 368, Dipartimento Scienze Economiche, Universita' di Bologna.
- Tybout, James R. & Westbrook, M. Daniel, 1995. "Trade liberalization and the dimensions of efficiency change in Mexican manufacturing industries," Journal of International Economics, Elsevier, vol. 39(1-2), pages 53-78, August.
- Nickell, S & Vainiomaki, J & Wadhwani, S, 1994. "Wages and Product Market Power," Economica, London School of Economics and Political Science, vol. 61(244), pages 457-73, November.
- Dhillon, Amrita & Petrakis, Emmanuel, 2002. "A generalised wage rigidity result," International Journal of Industrial Organization, Elsevier, vol. 20(3), pages 285-311, March.
When requesting a correction, please mention this item's handle: RePEc:esx:essedp:626. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Essex Economics Web Manager)
If references are entirely missing, you can add them using this form.