Exchange rates and wages in unionised labour markets
AbstractWe investigate the impact of exchange rate movements on wage determination in unionised labour markets. Using a simple model of international oligopoly, we show that organised labour has a rational incentive to accept lower wages in the face of a currency appreciation. This proposition is examined empirically using a matched worker-firm dataset for Portugal. We find results consistent with the predictions of the model, though the impact varies considerably with both worker characteristics and the regional unemployment rate.
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Bibliographic InfoPaper provided by University of Nottingham, GEP in its series Discussion Papers with number 10/15.
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Postal: School of Economics University of Nottingham University Park Nottingham NG7 2RD
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Exchange rates; trade unions; wage bargaining; worker-firm data;
Other versions of this item:
- Peter W. Wright & Paulo Bastos, 2012. "Exchange Rates and Wages in Unionized Labor Markets," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 65(4), pages 975-999, October.
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- Benjamin Bridgman, 2011. "Competition, Work Rules and Productivity," 2011 Meeting Papers 289, Society for Economic Dynamics.
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