Worker participation in decision‐making is often associated with high‐wage and high‐productivity firm strategies. Using linked employer–employee data for Germany and worker fixed effects from a two‐way fixed‐effects model of wages capturing observed and unobserved worker quality, we...

This paper examines how collective bargaining through unions and workplace codetermination through works councils shape labour market imperfections and how labour market imperfections matter for employer wage premia. Based on representative German plant data for the years 1999-2016, we document...