We found a match
Your institution may have access to this item. Find your institution then sign in to continue.
- Title
Welfare Effects of Local versus Central Wage Bargaining.
- Authors
Dittrich, Marcus
- Abstract
The paper analyses the welfare effects of union bargaining (de)centralization in a dual labour market with a unionized and a competitive sector. We show that social welfare depends on both the structure of the union's objective function and the elasticities of labour demand in both sectors. The welfare-maximizing employment allocation can be obtained under a high degree of centralization if the union maximizes the total wage-bill. Otherwise, if the union is rent maximizing, welfare is higher under local bargaining. However, in that case neither central nor local wage setting yields the social optimum.
- Subjects
WAGE bargaining; WELFARE state; PUBLIC welfare; LABOR unions; LABOR market; LABOR demand; DECENTRALIZATION in management; COLLECTIVE bargaining; INDUSTRIAL relations
- Publication
LABOUR: Review of Labour Economics & Industrial Relations, 2010, Vol 24, Issue 1, p26
- ISSN
1121-7081
- Publication type
Article
- DOI
10.1111/j.1467-9914.2010.00469.x