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The Effect of Unions on Firm Performance in Japanese Manufacturing

Author

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  • Giorgio Brunello

Abstract

Using data on a sample of 979 union and nonunion Japanese manufacturing firms selected from the 1987 issue of the Yearbook of Japanese Unlisted Companies, the author examines the relationship between union status and firm performance in Japan. The findings suggest that Japanese unions in the sample substantially reduced both productivity and profitability, as well as regular wages net of bonuses and fringes. These three union effects were considerably smaller in small and medium-size firms than in large firms, perhaps because many of the small and medium-size firms were subcontractors that were pressed by the firms contracting them to cut costs and increase productivity.

Suggested Citation

  • Giorgio Brunello, 1992. "The Effect of Unions on Firm Performance in Japanese Manufacturing," ILR Review, Cornell University, ILR School, vol. 45(3), pages 471-487, April.
    • Handle: RePEc:sae:ilrrev:v:45:y:1992:i:3:p:471-487
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    Cited by:

    1. Eguchi, Kyota, 2002. "Unions as commitment devices," Journal of Economic Behavior & Organization, Elsevier, vol. 47(4), pages 407-421, April.
    2. John Benson, 1994. "The Economic Effects of Unionism on Japanese Manufacturing Enterprises," British Journal of Industrial Relations, London School of Economics, vol. 32(1), pages 1-21, March.
    3. Zafiris TZANNATOS & Toke S. AIDT, 2006. "Unions and microeconomic performance: A look at what matters for economists (and employers)," International Labour Review, International Labour Organization, vol. 145(4), pages 257-278, December.
    4. Kyota Eguchi, 2000. "Unions, Job Security, and Incentives of Workers," CIRJE F-Series CIRJE-F-91, CIRJE, Faculty of Economics, University of Tokyo.
    5. Morikawa, Masayuki, 2010. "Labor unions and productivity: An empirical analysis using Japanese firm-level data," Labour Economics, Elsevier, vol. 17(6), pages 1030-1037, December.
    6. David Metcalf, 2002. "Unions and Productivity, Financial Performance and Investment: International Evidence," CEP Discussion Papers dp0539, Centre for Economic Performance, LSE.
    7. Dieter Sadowski & Uschi Backes-Gellner & Bernd Frick, 1995. "Works Councils: Barriers or Boosts for the Competitiveness of German Firms?," British Journal of Industrial Relations, London School of Economics, vol. 33(3), pages 493-513, September.
    8. Hristos Doucouliagos & Patrice Laroche, 2009. "Unions and Profits: A meta-regression Analysis," Post-Print hal-00648569, HAL.
    9. MORIKAWA Masayuki, 2008. "What Do Japanese Unions Do for Productivity?: An Empirical Analysis Using Firm-Level Data," Discussion papers 08027, Research Institute of Economy, Trade and Industry (RIETI).
    10. Tony Fang & Ying Ge & Youqing Fan, 2019. "Unions and the productivity performance of multinational enterprises: evidence from China," Asian Business & Management, Palgrave Macmillan, vol. 18(4), pages 281-300, September.
    11. Tsuru, Tsuyoshi & 都留, 康 & ツル, ツヨシ, 2009. "The Union Wage Premium, Voice, and Nonunion Workers' Attitudes: Before and After Japan's Lost Decade," Discussion Paper Series a516, Institute of Economic Research, Hitotsubashi University.
    12. Tsuyoshi Tsuru & James B. Rebitzer, 1995. "The Limits of Enterprise Unionism: Prospects for Continuing Union Decline in Japan," British Journal of Industrial Relations, London School of Economics, vol. 33(3), pages 459-492, September.
    13. S. Dobbelaere, 2003. "Joint Estimation of Price-Cost Margins and Union Bargaining Power for Belgian Manufacturing," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 03/171, Ghent University, Faculty of Economics and Business Administration.
    14. Kyota Eguchi, 2000. "Employment Protection Regulations and New Hiring," CIRJE F-Series CIRJE-F-88, CIRJE, Faculty of Economics, University of Tokyo.
    15. Pasquale Tridico & Sebastiano Fadda & Antonella Mennella, 2014. "Flexibility and Productivity: The Case of the Labour Supply Contract Agreement in Italy," QA - Rivista dell'Associazione Rossi-Doria, Associazione Rossi Doria, issue 3, September.

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