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Opening Clauses in Collective Bargaining Agreements: More Flexibility to Save Jobs?

Author

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  • Brändle Tobias

    (Institute for Applied Economic Research (IAW) Tübingen; Ob dem Himmelreich 1, 72074 Tübingen, Germany)

  • Heinbach Wolf Dieter

    (Ministry for Science, Research and Arts, Baden-Württemberg; University Hohenheim; IAW Tübingen)

Abstract

This paper analyses the impact of opening clauses in German collective bargaining agreements (CBAs) on job flows. Opening clauses should provide firms with more flexibility in economic crises. Therefore, firms operating under a CBA with opening clauses are expected to have lower job turnover, in particular lower job destruction under bad business conditions, and - if job creation is not adversely affected - higher job growth. We analyse this question empirically using data from the IAB Establishment Panel, a large and representative data set on German establishments. We supplement the data with additional information on the existence of opening clauses in CBAs in the West German manufacturing sector (using the IAW Data Set on Opening Clauses). By means of a matching approach, we address selection problems in flexible CBAs and reveal that the existence of opening clauses has a positive, albeit not always significant, effect on job growth. In contrast, there are no significant effects on job destruction and job creation per se, and, based on information given in the IAB Establishment Panel itself, explicit knowledge of opening clauses or their application have no additional effect on job flows.

Suggested Citation

  • Brändle Tobias & Heinbach Wolf Dieter, 2013. "Opening Clauses in Collective Bargaining Agreements: More Flexibility to Save Jobs?," Review of Economics, De Gruyter, vol. 64(2), pages 159-192, August.
  • Handle: RePEc:lus:reveco:v:64:y:2013:i:2:p:159-192
    DOI: 10.1515/roe-2013-0204
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    Cited by:

    1. John T. Addison & Alex Bryson & Paulino Teixeira & André Pahnke & Lutz Bellmann, 2011. "The Demise of a Model? The State of Collective Bargaining and Worker Representation in Germany," GEMF Working Papers 2011-09, GEMF, Faculty of Economics, University of Coimbra.
    2. Valeria Cirillo & Matteo Sostero & Federico Tamagni, 2019. "Firm-level pay agreements and within-firm wage inequalities: Evidence across Europe," LEM Papers Series 2019/12, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    3. Tobias Brändle, 2013. "Flexible Collective Bargaining Agreements: Still a Moderating Effect on Works Council Behaviour?," IAW Discussion Papers 96, Institut für Angewandte Wirtschaftsforschung (IAW).
    4. Bachmann, Ronald & Bonin, Holger & Boockmann, Bernhard & Demir, Gökay & Felder, Rahel & Isphording, Ingo & Kalweit, René & Laub, Natalie & Vonnahme, Christina & Zimpelmann, Christian, 2020. "Auswirkungen des gesetzlichen Mindestlohns auf Löhne und Arbeitszeiten: Studie im Auftrag der Mindestlohnkommission," RWI Projektberichte, RWI - Leibniz-Institut für Wirtschaftsforschung, number 222998, November.
    5. Markus Leibrecht & Silvia Rocha-Akis, 2014. "Sozialpartnerschaft und makroökonomische Performance," WIFO Monatsberichte (monthly reports), WIFO, vol. 87(8), pages 555-567, August.
    6. Eppinger, Peter S., 2019. "Service offshoring and firm employment," Journal of International Economics, Elsevier, vol. 117(C), pages 209-228.
    7. Kerndler, Martin, 2019. "Size and persistence matter: Wage and employment insurance at the micro level," ECON WPS - Working Papers in Economic Theory and Policy 04/2019, TU Wien, Institute of Statistics and Mathematical Methods in Economics, Economics Research Unit.
    8. Mirella Damiani & Fabrizio Pompei & Andrea Ricci, 2020. "Opting Out, Collective Contracts and Labour Flexibility: Firm‐Level Evidence for The Italian Case," British Journal of Industrial Relations, London School of Economics, vol. 58(3), pages 558-586, September.
    9. Addison, John T. & Teixeira, Paulino & Evers, Katalin & Bellmann, Lutz, 2013. "Collective Bargaining and Innovation in Germany: Cooperative Industrial Relations?," IZA Discussion Papers 7871, Institute of Labor Economics (IZA).
    10. Brändle, Tobias & Heinbach, Wolf Dieter & Maier, Michael F., 2011. "Tarifliche Öffnung in Deutschland: Ausmaß, Determinanten, Auswirkungen (Flexibilisation in the German system of wage bargaining: extent, determinants, impacts)," Zeitschrift für ArbeitsmarktForschung - Journal for Labour Market Research, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 44(1/2), pages 163-172.
    11. John T. Addison & Paulino Teixeira & Katalin Evers & Lutz Bellmann, 2015. "Pacts for Employment and Competitiveness as a Role Model? Their Effects on Firm Performance," GEMF Working Papers 2015-18, GEMF, Faculty of Economics, University of Coimbra.
    12. Capuano, Stella & Hauptmann, Andreas & Schmerer, Hans-Jörg, 2020. "Trade and unions: Does size matter?," Economic Modelling, Elsevier, vol. 84(C), pages 66-75.
    13. John T. Addison, 2016. "Collective bargaining systems and macroeconomic and microeconomic flexibility: the quest for appropriate institutional forms in advanced economies," IZA Journal of Labor Policy, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 5(1), pages 1-53, December.
    14. Bachmann, Ronald & Bonin, Holger & Boockmann, Bernhard & Demir, Gökay & Felder, Rahel & Isphording, Ingo E. & Kalweit, René & Laub, Natalie & Vonnahme, Christina & Zimpelmann, Christian, 2020. "Auswirkungen des gesetzlichen Mindestlohns auf Löhne und Arbeitszeiten," IZA Research Reports 96, Institute of Labor Economics (IZA).
    15. Anita Wölfl & Juan S. Mora-Sanguinetti, 2011. "Reforming the Labour Market in Spain," OECD Economics Department Working Papers 845, OECD Publishing.

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    More about this item

    Keywords

    collective bargaining; opening clauses; job flows; propensity score matching;
    All these keywords.

    JEL classification:

    • J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models

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