Resource title

Do Works Councils Inhibit Investment?

Resource image

image for OpenScout resource :: Do Works Councils Inhibit Investment?

Resource description

Theory suggests that firms confront a hold-up problem in dealing with workplace unionism: unions will appropriate a portion of the quasi rents stemming from long-lived capital. As a result, firms may be expected to limit their exposure to rent seeking by reducing investments, among other things. Although there is some empirical support for this prediction in firm-level studies for the United States, we investigate whether this is also the case in the different institutional context of Germany where the works council is the analogue of workplace unionism. Using parametric and nonparametric methods and establishment panel data, we find no evidence that the formation (dissolution) of a works council has an unfavorable (favorable) impact on investment.

Resource author

John T. Addison, Thorsten Schank, Claus Schnabel, Joachim Wagner

Resource publisher

Resource publish date

Resource language

eng

Resource content type

text/html

Resource resource URL

http://hdl.handle.net/10419/20772

Resource license

Adapt according to the presented license agreement and reference the original author.