Scandinavian Working Papers in Economics

Working Papers,
University of Aarhus, Aarhus School of Business, Department of Economics

No 08-9: New Workplace Practices and Firm Performance: A Comparative Study of Italy and Britain

Annalisa Cristini () and Dario Pozzoli ()
Additional contact information
Annalisa Cristini: Department of Economics, Postal: University of Bergamo, Via dei Caniana 2, 24127 Bergamo, Italy
Dario Pozzoli: Department of Economics, Aarhus School of Business, Postal: The Aarhus School of Business, Prismet, Silkeborgvej 2, DK 8000 Aarhus C, Denmark

Abstract: Using data from the 2004 Workplace Employee Relations Survey on British establishments and two surveys on manufacturing firms located in the North of Italy, we look at the diffusion of new workplace practices in the two countries and at their impact on the firm's value added. We find that the adoption of innovation practices has spread substantially more across the British manufacturing firms than across the Italian ones; however our results also indicate that the practices' association with the firms' VA is much lower in Britain than in Italy. The counterfactual analysis shows that had the Italian workplaces the same characteristics of the British ones, in terms of diffusion of practices, capital intensity and skills, their average predicted value added would triplicate. On the other hand, were the Italian establishments to move and operate in the British context, their performance would improve very modestly. For the British establishments, we also investigate whether management practices improve job satisfaction.

Keywords: Workplace practices; Financial Performance; Italy; UK

JEL-codes: C33; J41; J53; L20

47 pages, May 1, 2008

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08-9_dpoz.pdf PDF-file 

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