R&D and Union Bargaining: Evidence from British Companies and Plants

Posted: 17 Sep 1998

See all articles by Naercio Menezes-Filho

Naercio Menezes-Filho

Universidade de Sao Paolo - Department of Economics; Institute for Fiscal Studies (IFS)

David Ulph

University College London - Department of Economics; Government of the United Kingdom - Inland Revenue

John Van Reenen

London School of Economics - Centre for Economic Performance (CEP); Stanford Graduate School of Business; Institute for Fiscal Studies (IFS); Centre for Economic Policy Research (CEPR)

Abstract

U.S. research has found that unionization adversely affects research and development investment, consistent with the view that labor unions' rent-seeking activities act as a tax on innovation. In this U.K. study, preliminary analysis of two datasets (a cross-section of plants and a company panel for the years 1983-90) shows the same negative correlation. This correlation completely disappears, however, when controls are included for such factors as industry technological opportunity and cohort effects. Moreover, R&D intensity appears to have been higher where there were low levels of union density than where there was no union presence. Some evidence suggests that the difference between U.K and U.S. results may be due to cross-country differences in the prioritization of non-pay issues in bargaining.

JEL Classification: J53, O32

Suggested Citation

Menezes-Filho, Naercio and Ulph, David and Van Reenen, John Michael, R&D and Union Bargaining: Evidence from British Companies and Plants. Industrial and Labor Relations Review, October 1998. Available at SSRN: https://ssrn.com/abstract=100748

Naercio Menezes-Filho

Universidade de Sao Paolo - Department of Economics ( email )

Sao Paolo, 05508-010
Brazil

Institute for Fiscal Studies (IFS) ( email )

7 Ridgmount Street
London, WC1E 7AE
United Kingdom

David Ulph

University College London - Department of Economics ( email )

Gower Street
ESRC Center for Economics Learning and Social Evolution
London WC1E 6BT
United Kingdom
+44 20 7679 5862 (Phone)
+44 20 7916 2774 (Fax)

Government of the United Kingdom - Inland Revenue ( email )

Room F11, West Wing
Somerset House
London WC2R 1LB
United Kingdom
+44 20 7438 7487 (Phone)

John Michael Van Reenen (Contact Author)

London School of Economics - Centre for Economic Performance (CEP) ( email )

Houghton Street
London WC2A 2AE
United Kingdom
+44 20 7955 6976 (Phone)
+44 20 7955 6848 (Fax)

Stanford Graduate School of Business ( email )

655 Knight Way
Stanford, CA 94305-5015
United States

Institute for Fiscal Studies (IFS) ( email )

7 Ridgmount Street
London, WC1E 7AE
United Kingdom
+44 20 7240 6740 (Phone)
+44 20 7240 6136 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

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