Using a large panel data set it is investigated whether works councils act as sand or grease in the operation of German firms. Stochastic production frontier analysis indicates that establishments with and without a works council do not exhibit significant differences in efficiency.

Theory suggests that firms confront a hold-up problem in dealing with workplace unionism: unions will appropriate a portion of the quasi-rents stemming from long-lived capital. As a result, firms may be expected to limit their exposure to rent-seeking by reducing investments. The U.S. evidence...

"This paper makes an empirical investigation of the effects of the German Disabled Persons Act on employment dynamics using data from the Federal Employment Agency and the IAB Establishment Panel. The data permit an investigation of the second threshold of this law, which in the observation...

"In Germany, there exist around 160 threshold values stating that certain labour laws and regulations apply only in establishments above a critical size (usually defined by the number of employees). As crossing a threshold may result in additional costs for the firm, it is often hypothesized...

Using comprehensive data for West Germany, this paper investigates the determinants of establishment exit. We find that between 1975 and 2006 the average exit rate has risen considerably. In order to test various 'liabilities' of establishment survival identified in the literature, we analyze...

Using a large administrative dataset for Germany, this paper compares employment developments in exiting and surviving establishments. For both West and East Germany we find a clear 'shadow of death' effect reflecting lingering illness: establishments shrink dramatically already several years...

Using comprehensive data for West Germany, this paper investigates the determinants of establishment exit. We find that between 1975 and 2006 the average exit rate has risen considerably. In order to test various “liabilities” of establishment survival identified in the literature, we...