IDEAS home Printed from https://ideas.repec.org/p/iza/izadps/dp4352.html
   My bibliography  Save this paper

One-third Codetermination at Company Supervisory Boards and Firm Performance in German Manufacturing Industries: First Direct Evidence from a New Type of Enterprise Data

Author

Listed:
  • Wagner, Joachim

    (Leuphana University Lüneburg)

Abstract

This paper contributes to the empirical literature on the co-determination – firm performance nexus by using a new type of data that combines information on the co-determination status of enterprises from a commercial data base and supplementary information collected from the firms with comprehensive data on the firms from official statistics. The data allow for the first time a direct comparison of enterprises from the same size class with and without codetermination at the supervisory board level. It is shown that one-third codetermination at the supervisory board level in limited-liability companies from West German manufacturing industries seems to be neither positively nor negatively related to two core firm performance indicators, productivity and profitability.

Suggested Citation

  • Wagner, Joachim, 2009. "One-third Codetermination at Company Supervisory Boards and Firm Performance in German Manufacturing Industries: First Direct Evidence from a New Type of Enterprise Data," IZA Discussion Papers 4352, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp4352
    as

    References listed on IDEAS

    as
    1. 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, June.
    2. John T. Addison & Claus Schnabel, 2011. "Worker Directors: A German Product that Did Not Export?," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 50(2), pages 354-374, April.
    3. 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.
    4. 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.
    5. John T. Addison, 2009. "The Economics of Codetermination," Palgrave Macmillan Books, Palgrave Macmillan, number 978-0-230-10424-2, October.
    6. John T. Addison & Thorsten Schank & Claus Schnabel & Joachim Wagner, 2007. "Do Works Councils Inhibit Investment?," ILR Review, Cornell University, ILR School, vol. 60(2), pages 187-203, January.
    7. Joachim Wagner, 2007. "Exports and Productivity in Germany," Applied Economics Quarterly (formerly: Konjunkturpolitik), Duncker & Humblot, Berlin, vol. 53(4), pages 353-373.
    8. Sebastian Troch, 2009. "Drittelbeteiligung im Aufsichtsrat - Gesetzliche Regelung versus Unternehmenspraxis Ausmaß und Bestimmungsgründe der Umgehung des Drittelbeteiligungsgesetzes in Industrieunternehmen," Working Paper Series in Economics 128, University of Lüneburg, Institute of Economics.
    9. Mark Doms & Eric J. Bartelsman, 2000. "Understanding Productivity: Lessons from Longitudinal Microdata," Journal of Economic Literature, American Economic Association, vol. 38(3), pages 569-594, September.
    10. R. Schmalensee & R. Willig (ed.), 1989. "Handbook of Industrial Organization," Handbook of Industrial Organization, Elsevier, edition 1, volume 2, number 2.
    11. Joel Rogers & Wolfgang Streeck, 1995. "Works Councils: Consultation, Representation, and Cooperation in Industrial Relations," NBER Books, National Bureau of Economic Research, Inc, number roge95-1.
    12. Simon Renaud, 2007. "Dynamic Efficiency of Supervisory Board Codetermination in Germany," LABOUR, CEIS, vol. 21(4‐5), pages 689-712, December.
    13. Adams, Michael, 2006. "Die dunklen Seiten der Mitbestimmung," Wirtschaftsdienst – Zeitschrift für Wirtschaftspolitik (1949 - 2007), ZBW - Leibniz Information Centre for Economics, vol. 86(11), pages 699-705.
    14. Lucia Foster & John Haltiwanger & Chad Syverson, 2008. "Reallocation, Firm Turnover, and Efficiency: Selection on Productivity or Profitability?," American Economic Review, American Economic Association, vol. 98(1), pages 394-425, March.
    15. Delgado, Miguel A. & Farinas, Jose C. & Ruano, Sonia, 2002. "Firm productivity and export markets: a non-parametric approach," Journal of International Economics, Elsevier, vol. 57(2), pages 397-422, August.
    16. Stettes, Oliver, 2007. "Die Arbeitnehmermitbestimmung im Aufsichtsrat: Ergebnisse einer Unternehmensbefragung," IW-Trends – Vierteljahresschrift zur empirischen Wirtschaftsforschung, Institut der deutschen Wirtschaft (IW) / German Economic Institute, vol. 34(1), pages 17-30.
    17. 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, September.
    18. R. Schmalensee & R. Willig (ed.), 1989. "Handbook of Industrial Organization," Handbook of Industrial Organization, Elsevier, edition 1, volume 1, number 1.
    19. Schmalensee, Richard, 1989. "Inter-industry studies of structure and performance," Handbook of Industrial Organization, in: R. Schmalensee & R. Willig (ed.), Handbook of Industrial Organization, edition 1, volume 2, chapter 16, pages 951-1009, Elsevier.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Boneberg Franziska, 2011. "The Economic Consequences of One-third Co-determination in German Supervisory Boards: First Evidence for the Service Sector from a New Source of Enterprise Data," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 231(3), pages 440-457, June.
    2. Balsmeier, Benjamin & Bermig, Andreas & Dilger, Alexander, 2013. "Corporate governance and employee power in the boardroom: An applied game theoretic analysis," Journal of Economic Behavior & Organization, Elsevier, vol. 91(C), pages 51-74.
    3. John T. Addison & Claus Schnabel, 2011. "Worker Directors: A German Product that Did Not Export?," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 50(2), pages 354-374, April.
    4. Franziska Boneberg, 2010. "The Economic Consequences of one-third Codetermination in German Supervisory Boards: First Evidence for the Service Sector from a New Source of Enterprise Data," Working Paper Series in Economics 177, University of Lüneburg, Institute of Economics.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Franziska Boneberg, 2010. "The Economic Consequences of one-third Codetermination in German Supervisory Boards: First Evidence for the Service Sector from a New Source of Enterprise Data," Working Paper Series in Economics 177, University of Lüneburg, Institute of Economics.
    2. John T. Addison & Claus Schnabel, 2011. "Worker Directors: A German Product that Did Not Export?," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 50(2), pages 354-374, April.
    3. Boneberg Franziska, 2011. "The Economic Consequences of One-third Co-determination in German Supervisory Boards: First Evidence for the Service Sector from a New Source of Enterprise Data," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 231(3), pages 440-457, June.
    4. Simon Jäger & Shakked Noy & Benjamin Schoefer, 2022. "What Does Codetermination Do?," ILR Review, Cornell University, ILR School, vol. 75(4), pages 857-890, August.
    5. Balsmeier, Benjamin & Bermig, Andreas & Dilger, Alexander, 2013. "Corporate governance and employee power in the boardroom: An applied game theoretic analysis," Journal of Economic Behavior & Organization, Elsevier, vol. 91(C), pages 51-74.
    6. Xavier Hollandts & Nicolas Aubert, 2019. "La gouvernance salariale : contribution de la représentation des salariés à la gouvernance d’entreprise," Revue Finance Contrôle Stratégie, revues.org, vol. 22(1), pages 63-88, March.
    7. Helmut Fryges & Joachim Wagner, 2016. "Exports and Profitability — First Evidence for German Manufacturing Firms," World Scientific Book Chapters, in: Microeconometrics of International Trade, chapter 7, pages 245-277, World Scientific Publishing Co. Pte. Ltd..
    8. Joachim Wagner, 2014. "Extensive margins of imports, productivity and profitability: First evidence for manufacturing enterprises in Germany," Economics Bulletin, AccessEcon, vol. 34(3), pages 1669-1678.
    9. Joachim Wagner, 2016. "Exports, Imports and Profitability: First Evidence for Manufacturing Enterprises," World Scientific Book Chapters, in: Microeconometrics of International Trade, chapter 9, pages 311-338, World Scientific Publishing Co. Pte. Ltd..
    10. Burdin, Gabriel & Pérotin, Virginie, 2019. "Employee representation and flexible working time," Labour Economics, Elsevier, vol. 61(C).
    11. Cassiman, Bruno & ,, 2013. "Profiting from Innovation: Firm Level Evidence on Markups," CEPR Discussion Papers 9703, C.E.P.R. Discussion Papers.
    12. Forcillo, Donato, 2017. "Codetermination: the Presence of Workers on the Board. A Depth Analysis," MPRA Paper 81936, University Library of Munich, Germany.
    13. Gregorič, Aleksandra, 2022. "Board-level worker representation," GLO Discussion Paper Series 1136, Global Labor Organization (GLO).
    14. Joachim Wagner, 2014. "Extensive Margins of Imports and Profitability: First Evidence for Manufacturing Enterprises in Germany," Working Paper Series in Economics 298, University of Lüneburg, Institute of Economics.
    15. Uwe JIRJAHN & Stephen C. SMITH, 2018. "Nonunion Employee Representation: Theory And The German Experience With Mandated Works Councils," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 89(1), pages 201-233, March.
    16. Aghion, Philippe & Akcigit, Ufuk & Howitt, Peter, 2014. "What Do We Learn From Schumpeterian Growth Theory?," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 2, chapter 0, pages 515-563, Elsevier.
    17. Derek Bosworth & Joanne Loundes, 2002. "The Dynamic Performance of Australian Enterprises," Melbourne Institute Working Paper Series wp2002n03, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
    18. Joachim Wagner, 2014. "Exports and firm profitability: Quality matters!," Economics Bulletin, AccessEcon, vol. 34(3), pages 1644-1652.
    19. John T. Addison & Thorsten Schank & Claus Schnabel & Joachim Wagner, 2007. "Do Works Councils Inhibit Investment?," ILR Review, Cornell University, ILR School, vol. 60(2), pages 187-203, January.
    20. Backes-Gellner Uschi & Mohrenweiser Jens, 2010. "Die Wirkung des Betriebsverfassungsgesetzes am Beispiel der Freistellung von Betriebsräten – ein Beitrag zur Rechtstatsachenforschung / The Effect of the Works Council Act on Paid Leave of Absence of ," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 230(4), pages 420-435, August.

    More about this item

    Keywords

    one-third co-determination; firm performance; Germany;
    All these keywords.

    JEL classification:

    • J50 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp4352. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Holger Hinte (email available below). General contact details of provider: https://edirc.repec.org/data/izaaade.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.