Wage determination in Norwegian industry is investigated using a panel of over 7,000 firms over seventeen years. A standard right-to-manage bargaining model serves as theoretical background for the empirical specification. Wage equations focusing on the relative importance of insider versus outsider variables are estimated, controlling for firm-specific fixed effects. Although outsider variables are more important, insider variables have a significant effect on wages. Estimated insider weight is less than for countries with less-centralized wage determination. Using regional unemployment data, the author estimates unemployment elasticity between -0.04 and -0.10. There is no strong evidence for real wage resistance in the long run. Copyright 1997 by Royal Economic Society.
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