Pacts for Employment and Competitiveness as a Role Model? Their Effects on Firm Performance

John Addison, Paulino Teixeira, Katalin Evers and Lutz Bellmann
Additional contact information
Katalin Evers: Institute for Employment Research (IAB)
Lutz Bellmann: Friedrich-Alexander-Universität Erlangen-Nürnberg, IAB and IZA Bonn

No 2015-18, GEMF Working Papers from GEMF, Faculty of Economics, University of Coimbra

Abstract: Pacts for employment and competitiveness are an integral component of the ongoing process of decentralization of collective bargaining in Germany, a phenomenon that has been hailed as key to that nation's economic resurgence. Yet little is known about the effects of pacts on firm performance. The evidence largely pertains to employment and is decidedly mixed. The present paper investigates the association between pacts and a wider set of outcomes – wages, employment, investment, productivity, innovation, and survivability – in a RDD framework where the controls comprise establishments that negotiated over pacts but failed to reach agreement on their implementation. An extensive set of simulations are run to test for robustness of the key findings of the model. There is no evidence of pacts negatively impacting any of the selected measures of establishment performance. Indeed, the positive effects reported for wages, productivity, and innovation are sustained in simulations.

Keywords: pacts for employment and competitiveness; concession bargaining; opening clauses decentralization; firm performance; regression discontinuity design; Germany. (search for similar items in EconPapers)
JEL-codes: D22 J3 J41 J50 J53 (search for similar items in EconPapers)
Pages: 52 pages
Date: 2015-09
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Working Paper: Pacts for Employment and Competitiveness as a Role Model? Their Effects on Firm Performance (2015)
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