Collective wage agreements still play an important role in the German wage bargaining system. However, there is a critical debate in Germany whether collective agreements deliver the flexibility needed by firms to adjust to the needs of international competition and technological change. In recent years, the social partners in some industries have responded to this possible lack of flexibility by introducing so called opening clauses into their collective bargaining agreements. These allow firms to deviate from their collective agreement under certain conditions. The aim of this paper is to empirically analyze the prevalence of opening clauses in the German manufacturing sector and their impact on the wage structure. To provide a basis for the empirical analyses, a survey on the existence and intensity of opening clauses in central collective agreements has been conducted. Thereby, these sectoral data about opening clauses are exactly combined with those from the German Structure of Earnings Survey 1995 and 2001, a linked employer-employee dataset from German official statistics. The results show the number of collective bargaining agreements containing opening clauses increasing remarkably since 1991. Furthermore, the implementation of opening clauses into collective contracts creates significant effects on wages.
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Paper provided by Institut für Angewandte Wirtschaftsforschung (IAW) in its series IAW Discussion Papers with number
26.
Length: 30 pages Date of creation: Oct 2006 Date of revision: Handle: RePEc:iaw:iawdip:26
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References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
Gerlach, Knut & Stephan, Gesine, 2005.
"Wage distributions by wage-setting regime,"
IAB Discussion Paper
200509, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
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