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The geography of collective bargaining in multi-establishment companies: a strategic choice of employers

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  • Askenazy, Philippe
  • Cottineau, Clémentine

Abstract

Despite the growing interest in the firm bargaining process, little research has focused on the structure of bargaining within a multi-establishment firm. This paper explores whether running negotiations at the very decentralized level of the workplaces and/or at a multi-establishment level is an employer's strategic choice to maximise profits, according to the characteristics of the firm. We propose a model where the level chosen for bargaining depends on the geography of the firm. The employer faces a trade-off: workplace level bargaining allows deals that meet local conditions; but a higher level increases the distance between workers and their representatives, weakening their bargaining power. Using a representative survey of French establishments merged with administrative sources, we test this model and find a significant relation between the level of bargaining within a firm and the spatial distribution of its facilities.

Suggested Citation

  • Askenazy, Philippe & Cottineau, Clémentine, 2022. "The geography of collective bargaining in multi-establishment companies: a strategic choice of employers," CEPREMAP Working Papers (Docweb) 2205, CEPREMAP.
    • Handle: RePEc:cpm:docweb:2205
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    References listed on IDEAS

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    2. Arturs Kalnins & Francine Lafontaine, 2013. "Too Far Away? The Effect of Distance to Headquarters on Business Establishment Performance," American Economic Journal: Microeconomics, American Economic Association, vol. 5(3), pages 157-179, August.
    3. Ekkehart Schlicht, 2016. "Efficiency wages: Variants and implications," IZA World of Labor, Institute of Labor Economics (IZA), pages 275-275, July.
    4. Andrea Garnero & François Rycx & Isabelle Terraz, 2020. "Productivity and Wage Effects of Firm‐Level Collective Agreements: Evidence from Belgian Linked Panel Data," British Journal of Industrial Relations, London School of Economics, vol. 58(4), pages 936-972, December.
    5. Kristin Aarland & James C. Davis & J. Vernon Henderson & Yukako Ono, 2007. "Spatial organization of firms: the decision to split production and administration," RAND Journal of Economics, RAND Corporation, vol. 38(2), pages 480-494, June.
    6. Thomas Amossé & Alex Bryson & John Forth & Héloïse Petit (ed.), 2016. "Comparative Workplace Employment Relations," Palgrave Macmillan Books, Palgrave Macmillan, number 978-1-137-57419-0.
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    More about this item

    Keywords

    collective bargaining; decentralization; geography of the firm; multi-establishment firms; wages;
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