Wage Bargaining and Monopsony
AbstractThis paper identifies three possible outcomes of higher relative firm bargaining power in a unionized firm facing an upward sloping labor supply curve. The conventional regime with reduced wage and higher employment corresponds to firm bargaining power below a certain critical value. A supply constrained regime where increased firm bargaining power reduces both wages and employment occurs when the bargaining power is above another critical level. A novel result is that we identify a third regime, with firm bargaining power between these critical levels, where changes in relative bargaining power does not affect wages and employment.
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Bibliographic InfoPaper provided by Department of Economics, Norwegian University of Science and Technology in its series Working Paper Series with number 4304.
Length: 24 pages
Date of creation: 01 Sep 2004
Date of revision:
Monopsony; Unions; Wage bargaining;
Other versions of this item:
- J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
- J5 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining
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