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Profit-Sharing And Productivity: An Analysis Of Uk Engineering Firms

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  • Cable, John R.
  • Wilson, Nicholas

Abstract

The paper reports productivity differentials of 3-8% in favour of profit-sharing firms in the UK engineering industry. The estimates come from equations in which profit-sharing interacts with factor input levels and/or the firms' technological, organisational and labour-force characteristics, and imply more than a simple incentive effect on work effort, or more 'cooperative' behaviour in given circumstances. Model-selection tests reveal that these models dominate those used in previous work, where profit-sharing enters as a disembodied, Nicks-neutral shift in the production surface. A technological labour relations interpretation of the origin of the gains is suggested, which are found to be asymmetrically distributed. The results question policy measures to encourage profit-sharing which do not take account of its significance in the process of organisational design.

Suggested Citation

  • Cable, John R. & Wilson, Nicholas, 1988. "Profit-Sharing And Productivity: An Analysis Of Uk Engineering Firms," Economic Research Papers 268335, University of Warwick - Department of Economics.
    • Handle: RePEc:ags:uwarer:268335
    DOI: 10.22004/ag.econ.268335
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    References listed on IDEAS

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    4. Cable, John & Wilson, Nicholas, 1988. "Profit-Sharing And Productivity: An International Comparison," Economic Research Papers 268336, University of Warwick - Department of Economics.
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    10. Cable, J. & Wilson, N., 1988. "Profit-Sharing And Productivity: An International Comparison," The Warwick Economics Research Paper Series (TWERPS) 301, University of Warwick, Department of Economics.
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