Worker Directors: A German Product that Didn't Export?
Despite its lack of attractiveness to other countries, the German system of quasi-parity codetermination at company level has held up remarkably well. We recount the theoretical arguments for and against codetermination and survey the empirical evidence on the effects of the institution, tracing the three phases of a still sparse literature. Recent findings hold out the prospect that good corporate governance might include employee representation by virtue of the monitoring function and the reduction in agency costs, while yet cautioning that the optimal level of representation is likely below parity. And although the German system may be better than its reputation among foreigners, it might have to adapt to globalization and the availability of alternative forms of corporate governance in the EU.
|Date of creation:||Jan 2009|
|Date of revision:|
|Publication status:||published in: Industrial Relations, 2011, 50 (2), 354-374|
|Contact details of provider:|| Postal: IZA, P.O. Box 7240, D-53072 Bonn, Germany|
Phone: +49 228 3894 223
Fax: +49 228 3894 180
Web page: http://www.iza.org
|Order Information:|| Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany|
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.:
- Rebecca Gumbrell-McCormick & Richard Hyman, 2006. "Embedded collectivism?: workplace representation in France and Germany," LSE Research Online Documents on Economics 750, London School of Economics and Political Science, LSE Library.
- Kornelius Kraft & Jörg Stank, 2004. "Die Auswirkungen der gesetzlichen Mitbestimmung auf die Innova-tionsaktivität deutscher Unternehmen," Schmollers Jahrbuch : Journal of Applied Social Science Studies / Zeitschrift für Wirtschafts- und Sozialwissenschaften, Duncker & Humblot, Berlin, vol. 124(3), pages 421-449.
- Addison, John T. & Schnabel, Claus & Wagner, Joachim, 2003.
"The Course of Research into the Economic Consequences of German Works Councils,"
IZA Discussion Papers
878, Institute for the Study of Labor (IZA).
- John T. Addison & Claus Schnabel & Joachim Wagner, 2004. "The Course of Research into the Economic Consequences of German Works Councils," British Journal of Industrial Relations, London School of Economics, vol. 42(2), pages 255-281, 06.
- Addison, John T. & Schnabel, Claus & Wagner, Joachim, 2003. "The course of research into the economic consequences of German works councils," Discussion Papers 22, Friedrich-Alexander University Erlangen-Nuremberg, Chair of Labour and Regional Economics.
- Kraft, Kornelius, 1998. "The codetermined firm in oligopoly," Economics Letters, Elsevier, vol. 61(2), pages 195-201, November.
- Gérard Charreaux & Philippe Desbrières, 2001.
"Corporate Governance: Stakeholder Value Versus Shareholder Value,"
Working Papers CREGO
1010301, Université de Bourgogne - CREGO EA7317 Centre de recherches en gestion des organisations.
- Gérard Charreaux & Philippe Desbrières, 2001. "Corporate Governance: Stakeholder Value Versus Shareholder Value," Journal of Management and Governance, Springer, vol. 5(2), pages 107-128, June.
- Richard B. Freeman & Edward P. Lazear, 1994.
"An Economic Analysis of Works Councils,"
NBER Working Papers
4918, National Bureau of Economic Research, Inc.
- Kraft, Kornelius, 2001. "Codetermination as a strategic advantage?," International Journal of Industrial Organization, Elsevier, vol. 19(3-4), pages 543-566, March.
- Hirsch, Barry, 2003.
"What Do Unions Do for Economic Performance?,"
IZA Discussion Papers
892, Institute for the Study of Labor (IZA).
- Simon Renaud, 2007. "Dynamic Efficiency of Supervisory Board Codetermination in Germany," LABOUR, CEIS, vol. 21(4-5), pages 689-712, December.
- Fauver, Larry & Fuerst, Michael E., 2006. "Does good corporate governance include employee representation? Evidence from German corporate boards," Journal of Financial Economics, Elsevier, vol. 82(3), pages 673-710, December.
- Jensen, Michael C & Meckling, William H, 1979. "Rights and Production Functions: An Application to Labor-managed Firms and Codetermination," The Journal of Business, University of Chicago Press, vol. 52(4), pages 469-506, October.
- Gurdon, Michael A. & Rai, Anoop, 1990. "Codetermination and enterprise performance: Empirical evidence from West Germany," Journal of Economics and Business, Elsevier, vol. 42(4), pages 289-302, November.
- Luis M. Granero, 2006. "Codetermination, R&D, and Employment," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 162(2), pages 309-328, June.
- Felix FitzRoy & Kornelius Kraft, 2005.
"Co-determination, Efficiency and Productivity,"
British Journal of Industrial Relations,
London School of Economics, vol. 43(2), pages 233-247, 06.
- FitzRoy, Felix R & Kraft, Kornelius, 1993. " Economic Effects of Codetermination," Scandinavian Journal of Economics, Wiley Blackwell, vol. 95(3), pages 365-75.
- J. A. Hausman & W. E. Taylor, 1980.
"Panel Data and Unobservable Individual Effects,"
255, Massachusetts Institute of Technology (MIT), Department of Economics.
- Hausman, Jerry A & Taylor, William E, 1981. "Panel Data and Unobservable Individual Effects," Econometrica, Econometric Society, vol. 49(6), pages 1377-98, November.
- Hausman, Jerry A. & Taylor, William E., 1981. "Panel data and unobservable individual effects," Journal of Econometrics, Elsevier, vol. 16(1), pages 155-155, May.
- Barry T. Hirsch, 1991. "Labor Unions and the Economic Performance of Unions," Books from Upjohn Press, W.E. Upjohn Institute for Employment Research, number luepf, November.
- Benelli, Giuseppe & Loderer, Claudio & Lys, Thomas, 1987. "Labor Participation in Corporate Policy-Making Decisions: West Germany's Experience with Codetermination," The Journal of Business, University of Chicago Press, vol. 60(4), pages 553-75, October.
- Furubotn, Eirik G, 1988. "Codetermination and the Modern Theory of the Firm: A Property-Rights Analysis," The Journal of Business, University of Chicago Press, vol. 61(2), pages 165-81, April.
- Kornelius Kraft & Marija Ugarkovic, 2006. "Gesetzliche Mitbestimmung und Kapitalrendite," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), Justus-Liebig University Giessen, Department of Statistics and Economics, vol. 226(5), pages 588-604, September.
- Richard Hyman, 1997. "The Future of Employee Representation," British Journal of Industrial Relations, London School of Economics, vol. 35(3), pages 309-336, 09.
- Gary Gorton & Frank A. Schmid, 2004. "Capital, Labor, and The Firm: A Study of German Codetermination," Journal of the European Economic Association, MIT Press, vol. 2(5), pages 863-905, 09.
When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp3918. 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: (Mark Fallak)
If references are entirely missing, you can add them using this form.