The Impact of Financial Participation and Employee Involvement on Financial Performance

In recent years, considerable attention has been given to the impact of various forms of financial participation on financial performance. However, financial participation is only one of a number of different schemes attempting to elicit better performance and is itself heterogeneous. Moreover, financial participation schemes are typically introduced in conjunction with employee involvement schemes and their combined effect can be very different from their individual contributions. Indeed, concentrating on only one type of participation can seriously distort its relationship with financial performance. In this paper, a range of different employee participation schemes is examined, including two types of financial participation. The results indicate that financial participation has important interaction effects with particular types of employee involvement scheme and that the two main types of financial participation scheme have negative interactions. Furthermore, some employee involvement schemes are found to have a lower or even negative relationship with financial performance when introduced in isolation.     

Employee share ownership and performance: golden path or golden handcuffs?

Using matched employer-employee data from the 1998 Workplace Employee Relations Survey, it is suggested that the presence of employee share ownership at a workplace is not significantly associated with employee commitment to the organization. There is evidence of a significant negative relationship between share ownership and workplace turnover, which explains part of the positive share ownership/performance relationship. This calls into question the postulate that share ownership has its main impact upon performance via the closer alignment of employees' and employers' values and interests – the golden path – rather than the lowering of employee turnover – the golden handcuffs.     

Income Redistribution and Direct Taxes and Transfers in New Zealand

This article examines the redistributive effects of direct taxes and transfers in New Zealand. First, it reports summary measures of the income tax-and-transfer system using the NZ Household Economic Survey. Second, the article examines the characteristics of low-income NZ taxpayers. A decomposition by individual and household characteristics shows that different groups of low-income taxpayers can be affected quite differently by various aspects of the tax-and-transfer system. In particular, reforms involving tax-free zones do not appear to be well targeted to help those most in need.     

Workplace Performance,Worker Commitment,and Loyalty

Using matched employer–employee level data drawn from the 2004 UK Workplace and Employee Relations Survey, we explore the determinants of a measure of worker commitment and loyalty (CLI) and whether CLI influences workplace performance. Factors influencing employee commitment and loyalty include age and gender, whilst workplace level characteristics of importance include human resource (HR) practices. With respect to the effects of employee commitment and loyalty upon the workplace, higher CLI is associated with enhanced workplace performance. Our findings that workplace HRs influence CLI suggest that employers may be able to exert some influence over the commitment and loyalty of its workforce, which, in turn, may affect workplace performance.     

The impact of varying types of performance-related pay and employee participation on earnings

Using matched employer-employee data from a nationally representative sample of British establishments, the paper examines the impact of different types of performance-related pay (PRP) on earnings and whether this is moderated by the presence of employee involvement and financial participation schemes. It supports previous work that has suggested that there are strong and complex interactions between employee involvement schemes and compensation mechanisms. In particular, the results indicate that employees' earnings are highest where both individual and work-group PRP schemes are present at a workplace, and where there are congruent PRP and employee participation schemes.     

Workplace performance: a comparison of subjective and objective measures in the 2004 Workplace Employment Relations Survey

Understanding what determines workplace performance is important for a variety of reasons. In the first place, it can inform the debate about the UK's low productivity growth. It also enables researchers to determine the efficacy of different organisational practices, policies and payment systems. In this article, we examine not the determinants of performance but how it is measured. Specifically, we assess the alternative measures of productivity and profitability that are available in the 2004 Workplace Employment Relations Survey (WERS). Previous WERS have been an important source of data in research into workplace performance. However, the subjective nature of the performance measures available in WERS prior to 2004 has attracted criticism. In the 2004 WERS, data were again collected on the subjective measure but, in addition, objective data on profitability and productivity were also collected. This allows a comparison to be made between the two types of measures. A number of validity tests are undertaken and the main conclusion is that subjective and objective measures of performance are weakly equivalent but that differences are also evident. Our findings suggest that it would be prudent to give most weight to results supported by both types of measure.     

Job Evaluation and High Performance Work Practices: Compatible or Conflictual?

It can be argued that job evaluation and a high performance work strategy are either conflictual or compatible. On the one hand, job evaluation might be expected to introduce a greater degree of rigidity and top-down orientation to the pay and job structure, potentially yielding a conflict with the flexibility and employee involvement inherent in the high performance approach. On the other hand, job evaluation can be important in generating a feeling of equity in the workplace and thereby in promoting the high level of trust and commitment on which the success of the high performance strategy is seen to depend.     

Business Cycles and the Role of Confidence: Evidence for Europe*

This paper examines whether indicators of consumer and business confidence can predict movements in GDP over the business cycle for four European economies. The empirical methodology used to investigate the properties of the data comprises cross‐correlation statistics, implementing an approach developed by den Haan [Journal of Monetary Economics (2000) , Vol. 46, pp. 3–30]. The predictive power of confidence indicators is also examined, investigating whether they can predict discrete events, namely economic downturns, and whether they can quantitatively forecast point estimates of economic activity. The results indicate that both consumer and business confidence indicators are procyclical and generally play a significant role in predicting downturns.