Understanding variation in the efficacy of financial participation across Europe: The role of country-level factors

Mark Williams
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Mark Williams: University of Surrey, UK

Economic and Industrial Democracy, 2018, vol. 39, issue 2, 195-227

Abstract: Little is known about variation in the efficacy of financial participation across countries. This article examines the relationship between two types of financial participation (profit-sharing and employee share-ownership) and labour productivity across 29 European countries using a representative workplace survey. Consistent with theoretical expectations, profit-sharing is associated with superior labour productivity when it is open to all employees, whilst the evidence for employee share-ownership is more mixed. Analysis reveals considerable variation in the efficacy of both schemes across Europe. Country-level collective bargaining coverage has the greatest explanatory power in accounting for cross-country variation in efficacy. In countries with higher levels of collective bargaining coverage, profit-sharing performs less well, whereas employee share-ownership performs better, relative to countries with lower collective bargaining coverage. These findings shed light on the comparative dimension of the financial participation–labour productivity link.

Keywords: Employee share-ownership; Europe; financial participation; labour productivity; profit-sharing (search for similar items in EconPapers)
Date: 2018
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Persistent link: https://EconPapers.repec.org/RePEc:sae:ecoind:v:39:y:2018:i:2:p:195-227

DOI: 10.1177/0143831X15620846

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