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Labour Unions and Firm Productivity: Evidence from China

Chih‐Hai Yang and Meng-Wen Tsou

Manchester School, 2018, vol. 86, issue 6, 699-721

Abstract: This study investigates the effect of labour unions on productivity across various types of firm ownership in China. Using a panel dataset of Chinese manufacturing firms covering 2004–2007 and employing propensity score matching techniques, we find that unions have a negative impact on labour productivity and total factor productivity. From a dynamic viewpoint, unionisation has an initially positive or nonsignificant association with productivity, but then has a significant negative effect in subsequent years for both foreign‐owned enterprises and private firms. A strong and negative productivity effect is consistently observed for state‐owned enterprises.

Date: 2018
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