When Does Reducing Union Bargaining Power Increase Productivity? Evidence from the Workplace Relations Act
affiliation not provided to SSRN
School of Economics, La Trobe University
Economic Record, Vol. 87, Issue 279, pp. 603-616, 2011
Despite a large empirical literature, the conditions under which unions have different effects on productivity have not been determined. The Australian Workplace Relations Act 1996 (WRA) provides a natural experiment in which union bargaining power was decreased. We estimate productivity growth before and after the WRA. While the WRA did not increase productivity growth in union firms compared with non‐union firms, in industries with more extensive unionisation, productivity growth in union firms was greater post‐WRA compared with pre‐WRA growth for non‐union firms. This suggests unionisation tends to have greater effects on productivity in sectors where it is more extensive.
Number of Pages in PDF File: 14
JEL Classification: J51, D24, J58Accepted Paper Series
Date posted: November 13, 2011
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