Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/21178
Authors: 
Hübler, Olaf
Jirjahn, Uwe
Year of Publication: 
2001
Series/Report no.: 
IZA Discussion paper series 322
Abstract: 
This paper investigates the interaction between establishment-level codetermination and industry-level collective bargaining in Germany. Based on a simple bargaining model we derive our main hypothesis: In establishments covered by collective bargaining agreements works councils are more likely to be engaged in productivity enhancing activities and less engaged in rent seeking activities than their counterparts in uncovered firms. Using data from German manufacturing establishments, our empirical analysis confirms this hypothesis. The presence of works councils exerts a positive impact on productivity within the covered industrial relations regime but not within the uncovered industrial relations regime. In contrast, the presence of works councils has a positive effect on wages within the uncovered industrial relations regime but not to the same degree within the covered industrial relations regime.
Subjects: 
Dual industrial relations
bargaining
efficiency
rent seeking
correlated double selection
JEL: 
J53
D23
J24
J31
J51
Document Type: 
Working Paper

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