The Comparative Efficiency and Productivity of Labor-Managed and Capital-Managed Firms

The available empirical literature comparing the efficiency and productivity of labor-managed and capital-managed firms is reviewed and meta-analysed. The results suggest that labor-managed firms are not less efficient or less productive than capital-managed firns. Labor-managed firms have lower output-to-labor ratios and even lower capital-to-labor ratios. However, the differences in these ratios are not statistically significant. The labor-managed firm's democratic governance, industrial relations climate, and organisational setting do not appear to adversely affect productivity and efficiency