Effects of workplace representation on firm-provided further training in Germany

Abstract

Unions are an important indicator of various measures of firm performance in Anglo-Saxon countries. The same holds for the German analogue of workplace unionism's the works council. Using the IAB Establishment Panel I examine the impact of works councils and shop-floor participation on further training and training intensity. As some studies suggest that the impact of workplace representation varies with firm size, I also test for differences between large and small/medium-sized establish-ments. Pooled logit and count data models are employed to analyze firm's further training activity and training intensity. Because the treatment variables may suffer from endogeneity I also adopt linear and nonlinear instrumental variables techniques. The analysis reveals a positive impact of works councils on firm-provided further training, but provides slightly weaker evidence of firm-size differentials of workplace representation.

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