University of Tasmania
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Enterprise agreements, labour productivity and wage earnings : an evaluation of the impact of enterprise agreements on Australian labour productivity and average wage earnings

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posted on 2023-05-26, 21:03 authored by Farley, MJ
This thesis contains an evaluation of the impact of enterprise agreements on Australian labour productivity and wage earnings between 1992 and 2003. After almost a century of centralised industrial relations decision making, enterprise level bargaining provided employers and employees with the opportunity to negotiate working conditions and wages. The policy to introduce enterprise level bargaining was implemented as part of extensive microeconomic reform designed to improve the international competitiveness of the Australian economy. The industrial relations policy objective was to improve productivity by increasing technical and allocative efficiency at the enterprise level. The conclusions are that the introduction of enterprise agreements has contributed positively and significantly to labour productivity and that wage earnings are positively and significantly influenced by labour productivity. Both of these findings are significant. Australian labour productivity had previously been primarily influenced by growth in output, while wage earnings had been based on cost of living adjustments. There is preliminary evidence to suggest that by internalising bargaining over wage and conditions, enterprises have used the bargaining process to introduce significant change and the agreement to formalise these changes. The findings are based on a policy evaluation framework. This requires a comprehensive approach and as such the following perspectives are included: ‚Äö Policy evaluation; ‚Äö Organisational design, management and industrial relations theory and practice and their convergence; ‚Äö Production theory and productivity measurement; and ‚Äö Wages and wage earnings models. Econometric techniques are used to quantify the impact of introducing enterprise level agreements. Generalised least squares and fixed effects modelling is applied to determine the impact of introducing enterprise agreements on labour productivity and wage earnings respectively. The analysis focuses on both the impact on the economy overall and within the production/resources, margins and service sectors. The enterprise agreement data set comprises Department of Employment and Workplace Relations (DEWR) unpublished data relating to enterprise agreements registered in the federal jurisdiction from 1992 to 2003. This is combined with ABS industry level data. The impact of enterprise level agreements on productivity is modelled using an expanded Cobb Douglas production function applied at the economy and sectoral levels. The impact of decentralised agreements on wage earnings is modelled using empirical approaches consistent with Reserve Bank of Australia and international studies.


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Copyright 2006 the author - The University is continuing to endeavour to trace the copyright owner(s) and in the meantime this item has been reproduced here in good faith. We would be pleased to hear from the copyright owner(s). Thesis (MEc)--University of Tasmania, 2007. Includes bibliographical references

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