UNIONS, INNOVATION AND INVESTMENT - AUSTRALIAN EVIDENCE

Machin and Wadhwani have produced evidence indicating that trade union s encourage investment in the UK. This paper uses comparable data to a scertain whether their finding holds with respect to Australia. In gen eral, and contrary to the UK study, the net effect of unions on invest ment in Australia is found to be negative. Nevertheless, investment le vels at workplaces where unions were active were above the levels at n on-union workplaces, offering support for the union-voice hypothesis w hich Machin and Wadhwani use to explain their results.