Keywords
Citation
(1999), "Labour market flexibility and inward investment in Germany and the UK", European Business Review, Vol. 99 No. 6. https://doi.org/10.1108/ebr.1999.05499fab.011
Publisher
:Emerald Group Publishing Limited
Copyright © 1999, MCB UP Limited
Labour market flexibility and inward investment in Germany and the UK
Keywords Labour market, Foreign investment, Industrial relations, Germany, United Kingdom
An Anglo-German Foundation publication - Labour Market Flexibility and Inward Investment in Germany and the UK, by Philip Raines, Roland DÎhrn, Ross Brown and Markus Scheuer, asks: How important is labour market flexibility in determining an investment location? How have UK-German differences in labour market regulation and flexibility influenced the investment decisions and employment practices of multinationals?
Enterprises may have a wide variety of motives when they invest abroad: they could be seeking proximity to their markets, lower-cost production opportunities, or a location with favourable tax conditions. In spite of this variety of factors, a consistent and widely accepted theory to explain the location of foreign direct investment (FDI) has thus far eluded researchers.
National employment regulation and industrial relations structures are increasingly regarded as key factors in determining workforce flexibility and thus also the extent of FDI. Germany and the UK seem to offer clear but contrasting examples of this process: the UK's success in attracting FDI has often been attributed to its low level of employment protection, whereas the image of German labour markets as being inflexible and costly has been cited as a reason for the country's under-performance in foreign investment attraction.
This report addresses this issue by presenting the findings of a study into the relationship between employment regulation and foreign investment in Germany and the UK. Funded by the Anglo-German Foundation, the study was carried out by a team of researchers based at the European Policies Research Centre at the University of Strathclyde (Glasgow) and the Rheinisch-WestfÌlisches Institut fÏr Wirtschaftsforschung (Essen).
The report (ISBN 1-900834-14-6) has 57 pages and costs £12 incl. p&p from AGF Book Sales, c/o YPS distribution, 64 Hallfield Road, Layerthorpe, York YO3 7XQ. Tel: +44 (0)1904 430033. A free copy can be downloaded from www.agf.org.uk
Further information from Philip Raines. Fax: +44 (0) 141 5483672: e-mail: eprc@strath.ac.uk