UK Unionism and Innovative Activity: Some Cautionary Remarks on the Basis of a Simple Cross-Country Test

This paper offers a preliminary investigation of union impact on investment in intangible capital. We first report evidence on the raw correlation between union membership density and R&D intensity. This suggests that higher union density is associated with increased innovative activity among an important subset of British industry. Attention then shifts to a consideration of whether the ‘stylized facts’ are indicative of a causal relation or are instead an artefact produced by the concentration of unions in those sectors evincing greater scope for R&D. We offer a simple cross-country test in which German R&D outlays serve as the benchmark or comparator. No support is adduced for the notion that unions cause higher R&D.