Wage bargaining and monopsony
AbstractThis paper identifies three possible outcomes of higher relative firm bargaining power in a unionized firm facing an upward sloping labor supply curve. The conventional regime with reduced wage and higher employment corresponds to firm bargaining power below a certain critical value. A supply constrained regime where increased firm bargaining power reduces both wages and employment occurs when the bargaining power is above another critical level. A novel result is that we identify a third regime, with firm bargaining power between these critical levels, where changes in relative bargaining power does not affect wages and employment.
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Bibliographic InfoArticle provided by Elsevier in its journal Economics Letters.
Volume (Year): 94 (2007)
Issue (Month): 2 (February)
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Web page: http://www.elsevier.com/locate/ecolet
Other versions of this item:
- J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
- J5 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining
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