Co-Determination and Innovation

45 Pages Posted: 26 Oct 2009

See all articles by Kornelius Kraft

Kornelius Kraft

University of Dortmund - Department of Economics; IZA Institute of Labor Economics

Jörg Stank

affiliation not provided to SSRN

Ralf Dewenter

University of the Federal Armed Forces Hamburg - Department of Economics

Abstract

This paper examines the effect of the German co-determination law of 1976 (MitbestG) on the innovative activity of German firms. Co-determination applies to firms with 2000 employees or more. Data from 1971-1976 and 1981-1990 on 148 firms are used to compare the number of patents granted to co-determined firms before and after the introduction of the law. Several control variables are applied and in particular, in order to avoid a possible bias from specific effects of firm size, we compare the co-determined firms with others before and after 1976. The results do not support the view that co-determination slows down technological progress and reduces innovativeness.

Keywords: co-determination, innovation, patents

JEL Classification: J5, L2, O3

Suggested Citation

Kraft, Kornelius and Stank, Jörg and Dewenter, Ralf, Co-Determination and Innovation. IZA Discussion Paper No. 4487, Available at SSRN: https://ssrn.com/abstract=1493863

Kornelius Kraft (Contact Author)

University of Dortmund - Department of Economics ( email )

D-44221 Dortmund
Germany
+49 231 755-3152 (Phone)
+49 231 755-3155 (Fax)

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Jörg Stank

affiliation not provided to SSRN

No Address Available

Ralf Dewenter

University of the Federal Armed Forces Hamburg - Department of Economics ( email )

Holstenhofweg 85
Hamburg, 22043
Germany

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