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Wages and the bargaining regime under multi-level bargaining: Belgium, Denmark and Spain

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  • Robert Plasman
  • Michael Rusinek
  • François Rycx

Abstract

Using a unique harmonized matched employer-employee dataset (European Structure of Earnings Survey, 1995), we study the impact of the regime of collective bargaining on wages in the manufacturing sector of three countries that are characterized by a multilevel system of bargaining: Belgium, Denmark and Spain. Our findings show that, compared to multi-employer bargaining, single-employer bargaining has a positive effect both on wage levels and on wage dispersion in Belgium and in Denmark. In Spain, single-employer bargaining also increases wage levels but reduces wage dispersion. Our interpretation is that in Belgium and Denmark, single-employer bargaining is used to adapt pay to the specific needs of the firm while, in Spain, it is mainly used by trade unions in order to compress the wage distribution.

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Bibliographic Info

Paper provided by ULB -- Universite Libre de Bruxelles in its series ULB Institutional Repository with number 2013/9777.

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Date of creation: 2007
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Publication status: Published in: European Journal of Industrial Relations (2007) v.13 n° 2,p.161-180
Handle: RePEc:ulb:ulbeco:2013/9777

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  1. Richard B. Freeman, 1980. "Unionism and the dispersion of wages," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 34(1), pages 3-23, October.
  2. Juan Francisco Canal Domínguez & César Rodríguez Gutiérrez, 2004. "Collective Bargaining and Within-firm Wage Dispersion in Spain," British Journal of Industrial Relations, London School of Economics, vol. 42(3), pages 481-506, 09.
  3. Ana Rute Cardoso & Pedro Portugal, 2003. "Bargained Wages, Wage Drift and the Design of the Wage Setting System," Working Papers w200318, Banco de Portugal, Economics and Research Department.
  4. Teulings,Coen & Hartog,Joop, 1998. "Corporatism or Competition?," Cambridge Books, Cambridge University Press, number 9780521590730, April.
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  7. White, Halbert, 1980. "A Heteroskedasticity-Consistent Covariance Matrix Estimator and a Direct Test for Heteroskedasticity," Econometrica, Econometric Society, vol. 48(4), pages 817-38, May.
  8. Stewart, Mark B, 1987. "Collective Bargaining Arrangements, Closed Shops and Relative Pay," Economic Journal, Royal Economic Society, vol. 97(385), pages 140-56, March.
  9. Juhn, Chinhui & Murphy, Kevin M & Pierce, Brooks, 1993. "Wage Inequality and the Rise in Returns to Skill," Journal of Political Economy, University of Chicago Press, vol. 101(3), pages 410-42, June.
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  11. François Rycx & Robert Plasman, 2003. "Industry wage differentials and the bargaining regime in a corporatist country," ULB Institutional Repository 2013/787, ULB -- Universite Libre de Bruxelles.
  12. Lazear, Edward P & Rosen, Sherwin, 1981. "Rank-Order Tournaments as Optimum Labor Contracts," Journal of Political Economy, University of Chicago Press, vol. 89(5), pages 841-64, October.
  13. Rodriguez-Gutierrez, Cesar, 2001. "Wage dispersion within firms and collective bargaining in Spain," Economics Letters, Elsevier, vol. 72(3), pages 381-386, September.
  14. Hibbs, Douglas Jr. & Locking, Hakan, 1996. "Wage compression, wage drift and wage inflation in Sweden," Labour Economics, Elsevier, vol. 3(2), pages 109-141, September.
  15. Dell'Aringa, Carlo & Lucifora, Claudio, 1994. "Collective bargaining and relative earnings in Italy," European Journal of Political Economy, Elsevier, vol. 10(4), pages 727-747, December.
  16. Carlos Garcia-Serrano & Miguel A. Malo, 2002. "Worker Turnover, Job Turnover and Collective Bargaining in Spain," British Journal of Industrial Relations, London School of Economics, vol. 40(1), pages 69-85, 03.
  17. Diego R.PALENZUELA & Juan F.JIMENO, 1996. "Wage Drift in Collective Bargaining at the Firm Level: Evidence from Spain," Annales d'Economie et de Statistique, ENSAE, issue 41-42, pages 187-206.
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