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Profit Sharing, Unions And Investments

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Author Info

  • HOEL, M.
  • MOENE, K.O.

Abstract

The pay parameters in a profit-sharing system are likely to be determined by collective bargaining between unions and employers. In this case, employment will not necessarily be higher under profit sharing than under a fixed wage system. For a fixed capital stock, the most likely case is that profit sharing is better for unions and worse for employers than a fixed wage system. With endogenous investments, both parties may be worse off under profit sharing than under a fixed wage system. This might be one of the reasons why the authors in fact do not observe much profit sharing under collective bargaining. Copyright 1988 by The editors of the Scandinavian Journal of Economics.

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Bibliographic Info

Paper provided by Oslo University, Department of Economics in its series Memorandum with number 29/1988.

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Length: 13 pages
Date of creation: 1988
Date of revision:
Handle: RePEc:hhs:osloec:1988_029

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Postal: Department of Economics, University of Oslo, P.O Box 1095 Blindern, N-0317 Oslo, Norway
Phone: 22 85 51 27
Fax: 22 85 50 35
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Web page: http://www.oekonomi.uio.no/indexe.html
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Keywords: investments ; trade unions ; profit ; employment;

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Cited by:
  1. Asheim, G.B. & Strand, J., 1989. "Long-Term Union-Firm Contracts," Papers 10-89, Norwegian School of Economics and Business Administration-.
  2. Michaelis, Jochen, 1997. "On the equivalence of profit and revenue sharing," Economics Letters, Elsevier, vol. 57(1), pages 113-118, November.
  3. Pablo González, 2002. "Profit Sharing Reconsidered: Efficiency Wages and Renegotiation Costs," Documentos de Trabajo 151, Centro de Economía Aplicada, Universidad de Chile.
  4. Jan Sørensen, 1992. "Profit-sharing in a unionized cournot duopoly," Journal of Economics, Springer, vol. 55(2), pages 151-167, June.
  5. Tim Jenkinson & Sandeep Bhargava, 1996. "Partage explicite ou implicite du profit dans la détermination des salaires," Économie et Prévision, Programme National Persée, vol. 126(5), pages 19-29.

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