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Implications of wage bargaining systems on regional differentiation in the European Union

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Author Info
Luminita VOCHITA
George CIOBANU
Andreea CIOBANU (University of Craiova)

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Abstract

The theoretical literature has argued that a centralized wage bargaining system may result in low regional wage differentiation and high regional unemployment differentials. The empirical literature has found that centralized wage bargaining leads to lower wage inequality for different skills, industries and population groups, but has not investigated its impact on regional wage differentiation. Empirical evidence in this paper for EU regions suggests that countries with more coordinated wage bargaining systems have lower regional wage differentials, after controlling for regional productivity and unemployment differentials.

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File URL: http://feaa.ucv.ro/AUCSSE/0036v2-028.pdf
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Publisher Info
Article provided by University of Craiova, Faculty of Economics and Business Administration in its journal Annals of Computational Economics.

Volume (Year): 2 (2008)
Issue (Month): 36 (may)
Pages: 862-873
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Handle: RePEc:aio:aucsse:v:2:y:2008:i:11:p:862-873

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Related research
Keywords: regional wage differentiation; wage bargaining system; regional unemployment differentials; regional productivity differentials;

Find related papers by JEL classification:
O00 - Economic Development, Technological Change, and Growth - - General - - - General
O15 - Economic Development, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
O57 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries

References listed on IDEAS
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  1. Carlo Dell'Aringa & Laura Pagani, 2007. "Collective Bargaining and Wage Dispersion in Europe," British Journal of Industrial Relations, Blackwell Publishers Ltd/London School of Economics, vol. 45(1), pages 29-54, 03. [Downloadable!] (restricted)
  2. Cukierman, Alex & Lippi, Francesco, 1999. "Central bank independence, centralization of wage bargaining, inflation and unemployment:: Theory and some evidence," European Economic Review, Elsevier, vol. 43(7), pages 1395-1434, June. [Downloadable!] (restricted)
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  3. Brunello, Giorgio & Lupi, Claudio & Ordine, Patrizia, 2001. "Widening differences in Italian regional unemployment," Labour Economics, Elsevier, vol. 8(1), pages 103-129, January. [Downloadable!] (restricted)
  4. Alun H. Thomas, 2002. "The Costs and Benefits of Various Wage Bargaining Structures: An Empirical Exploration," IMF Working Papers 02/71, International Monetary Fund. [Downloadable!]
  5. Pench, L.R. & Sestito, P. & Frontini, E., 1999. "Some Unpleasant Arithmetics of Regional Unemployment in the EU. Are there any lessons for EMU?," European Economy - Economic Papers 134, Commission of the EC, Directorate-General for Economic and Financial Affairs (DG ECFIN).
  6. Robert J. Flanagan, 1999. "Macroeconomic Performance and Collective Bargaining: An International Perspective," Journal of Economic Literature, American Economic Association, vol. 37(3), pages 1150-1175, September. [Downloadable!] (restricted)
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