A Model of Wage Bargaining
An equation for earnings is derived from the assumption that wage increases are determined in a process of negotiation bet ween union and firm. The union is taken to be concerned about real wa ge, the firm about its real profit. The goods market is perfectly com petitive. The empirical work supported the hypothesis. The data sugge sted that employees' concerns have more influence on the outcome than employers'. The levels of profits and the real wage both played a ro le in explaining wage increases. The change in unemployment was found relevant to the outcome as well as the level. Copyright 1987 by Blackwell Publishing Ltd
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Volume (Year): 49 (1987)
Issue (Month): 4 (November)
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