14 Pages Posted: 13 Nov 2011
Date Written: December 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.
JEL Classification: J51, D24, J58
Suggested Citation: Suggested Citation
Farmakis-Gamboni, Samantha and Prentice, David, When Does Reducing Union Bargaining Power Increase Productivity? Evidence from the Workplace Relations Act (December 2011). Economic Record, Vol. 87, Issue 279, pp. 603-616, 2011. Available at SSRN: https://ssrn.com/abstract=1958466 or http://dx.doi.org/10.1111/j.1475-4932.2011.00757.x
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