The Effects of Union Wage-Settings on Firms’ Production Factor Decisions
AbstractThis study is concerned with the development of a theoretical model and its empirical application to the estimation of the interaction between firms and trade union in determining wages and employment. The focus is on analyzing the effects of unions’ demands on the firm’s choice of factors of production. In a two-step process the union and firm determine wages and capital stock, conditional on which the firm decides on production factors of employment, working hours and capital operating time. We suggest the use of a panel data approach applied to manufacturing data. A dynamic model is specified in which the optimal levels of the variables of interest and the speed of their adjustments are modeled in terms of observable policy variables.
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Bibliographic InfoPaper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 689.
Length: 13 pages
Date of creation: Jan 2003
Date of revision:
Publication status: published in: Applied Economics Letters, 2004, 11 (7), 415-420
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Other versions of this item:
- Almas Heshmati & Ilham Haouas, 2004. "The effects of union wage-settings on firms' production factor decisions," Applied Economics Letters, Taylor & Francis Journals, Taylor & Francis Journals, vol. 11(7), pages 415-420.
- C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
- D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
- E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution
- J50 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - General
- L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
This paper has been announced in the following NEP Reports:
- NEP-AFR-2003-02-10 (Africa)
- NEP-ALL-2003-02-10 (All new papers)
- NEP-LAB-2003-02-10 (Labour Economics)
- NEP-PKE-2003-02-10 (Post Keynesian Economics)
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.:
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