DP204 Profit Sharing in British Industry, 1865-1913

Author(s): Timothy J. Hatton
Publication Date: November 1987
Keyword(s): English Economic History, Industrial Relations, Labour Productivity, Profit-Sharing
JEL(s): 044, 824, 825
Programme Areas: Human Resources
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=204

Some 300 profit-sharing schemes were introduced in Britain between 1865 and 1913. These were intended both to raise labour productivity and to improve industrial relations in the firms concerned. These schemes appear to have increased significantly the wages of eligible workers but were frequently abandoned after an initial period of experiment. Analysis of data concerning these schemes indicates that the method of payment and the size of firm played important roles in the survival of the schemes, but that the probability of abandonment increased with the duration of the scheme.