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Co-Determination, Efficiency, and Productivity

Author

Listed:
  • FitzRoy, Felix

    () (University of St. Andrews)

  • Kraft, Kornelius

    () (TU Dortmund)

Abstract

We present the first panel estimates of the productivity effects of the unique German institution of parity, board-level co-determination. Although our data span two severe recessions when labour hoarding costs of co-determination are probably highest, and the panel is too short to capture the likely long run benefits in terms of human capital formation and job satisfaction, we find positive productivity effects of the 1976 extension to parity co-determination in large firms.

Suggested Citation

  • FitzRoy, Felix & Kraft, Kornelius, 2004. "Co-Determination, Efficiency, and Productivity," IZA Discussion Papers 1442, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp1442
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    References listed on IDEAS

    as
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    6. Richard B. Freeman & Edward P. Lazear, 1995. "An Economic Analysis of Works Councils," NBER Chapters,in: Works Councils: Consultation, Representation, and Cooperation in Industrial Relations, pages 27-52 National Bureau of Economic Research, Inc.
    7. Wolfgang Streeck, 1995. "Works Councils in Western Europe: From Consultation to Participation," NBER Chapters,in: Works Councils: Consultation, Representation, and Cooperation in Industrial Relations, pages 313-350 National Bureau of Economic Research, Inc.
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    14. FitzRoy, Felix R & Kraft, Kornelius, 1993. " Economic Effects of Codetermination," Scandinavian Journal of Economics, Wiley Blackwell, vol. 95(3), pages 365-375.
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    More about this item

    Keywords

    co-determination; employee involvement; productivity;

    JEL classification:

    • D2 - Microeconomics - - Production and Organizations
    • J5 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining
    • L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior

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