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Real Wage Determination and Rent-Sharing in Collective Bargaining Agreements

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  • L Christofides
  • A Oswald

Abstract

The microeconomic forces that influence real wages are not fully understood. This paper studies pay determination using data on approximately 600 labour contracts. It finds that the real wage is an increasing function of past profitability in the employer's industry, and a decreasing function of the level of unemployment in the employer's region. These results are consistent with rent-sharing theories.

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Bibliographic Info

Paper provided by Centre for Economic Performance, LSE in its series CEP Discussion Papers with number dp0042.

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Date of creation: Jul 1991
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Handle: RePEc:cep:cepdps:dp0042

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Web page: http://cep.lse.ac.uk/_new/publications/series.asp?prog=CEP

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