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Urban wage premia, cost of living, and collective bargaining

Author

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  • Marianna Belloc
  • Paolo Naticchioni
  • Claudia Vittori

Abstract

In this article, we estimate urban wage premia (UWPs) in Italy, with its economy characterized by the interplay between collective wage bargaining and spatial heterogeneity in the cost of living. Our dataset for the 2005–2015 period exploits detailed information on the universe of workers in the private sector and price measures disaggregated at a fine spatial level. For employees under collective bargaining, we find a zero UWP in nominal terms and a negative UWP in real terms. When we turn to consider various groups of self-employed workers, who are not covered by national labor agreements, we instead find a positive nominal UWP and no real wage penalties.

Suggested Citation

  • Marianna Belloc & Paolo Naticchioni & Claudia Vittori, 2023. "Urban wage premia, cost of living, and collective bargaining," Journal of Economic Geography, Oxford University Press, vol. 23(1), pages 25-50.
    • Handle: RePEc:oup:jecgeo:v:23:y:2023:i:1:p:25-50.
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    File URL: http://hdl.handle.net/10.1093/jeg/lbab048
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    Cited by:

    1. Giovanni Tonutti & Andrea Garnero & Gaia Bertarelli & Monica Pratesi, 2024. "The local distribution of in-work poverty and sectoral employment: an analysis of local dynamics in Italy," Statistical Methods & Applications, Springer;Società Italiana di Statistica, vol. 33(3), pages 973-998, July.
    2. Bernardo Fanfani, 2019. "The Employment Effects of Collective Bargaining," Working papers 064, Department of Economics, Social Studies, Applied Mathematics and Statistics (Dipartimento di Scienze Economico-Sociali e Matematico-Statistiche), University of Torino.
    3. Andrea R. Lamorgese & Elisabetta Olivieri & Marco Paccagnella, 2019. "The Wage Premium in Italian Cities," Italian Economic Journal: A Continuation of Rivista Italiana degli Economisti and Giornale degli Economisti, Springer;Società Italiana degli Economisti (Italian Economic Association), vol. 5(2), pages 251-279, July.
    4. Vittorio Daniele, 2022. "Produttività, salari e prezzi nelle regioni italiane," Regional Economy, , vol. 6(Q3), pages 3-14.
    5. Augusto Cerqua & Guido Pellegrini, 2020. "Labor mobility effects of a firm-level shock," Working Papers 1/20, Sapienza University of Rome, DISS.
    6. Andrea Garnero & Claudio Lucifora, 2022. "Turning a ‘Blind Eye’? Compliance with Minimum Wage Standards and Employment," Economica, London School of Economics and Political Science, vol. 89(356), pages 884-907, October.
    7. Andrea Garnero & Claudio Lucifora, 2020. "Turning A Blind Eye? Compliance To Minimum Wages And Employment," DISCE - Working Papers del Dipartimento di Economia e Finanza def085, Università Cattolica del Sacro Cuore, Dipartimenti e Istituti di Scienze Economiche (DISCE).
    8. Brändle, Tobias, 2024. "Unions and Collective Bargaining: The Influence on Wages, Employment and Firm Survival," GLO Discussion Paper Series 1457, Global Labor Organization (GLO).
    9. Francesco Devicienti & Bernardo Fanfani, 2025. "Firms' margins of adjustment to wage growth: the case of Italian collective bargaining," Economica, London School of Economics and Political Science, vol. 92(365), pages 107-149, January.
    10. Tito Boeri & Andrea Ichino & Enrico Moretti & Johanna Posch, 2021. "Wage Equalization and Regional Misallocation: Evidence from Italian and German Provinces [“Regional Wage Disparities and Migration.”]," Journal of the European Economic Association, European Economic Association, vol. 19(6), pages 3249-3292.
    11. Roudy Sassine, 2024. "Assessing sectoral capacity for wage increase: a multidimensional analysis using CPS ASEC data," Business Economics, Palgrave Macmillan;National Association for Business Economics, vol. 59(4), pages 243-257, October.
    12. Alessia Matano, 2022. "Spatial externalities in big cities and duality of the labour market," Journal of Regional Science, Wiley Blackwell, vol. 62(2), pages 471-498, March.
    13. Fanfani, Bernardo, 2023. "The employment effects of collective wage bargaining," Journal of Public Economics, Elsevier, vol. 227(C).
    14. Belloc, Filippo & D’Antoni, Massimo, 2020. "The Elusive Effect of Employment Protection on Labor Turnover," Structural Change and Economic Dynamics, Elsevier, vol. 54(C), pages 11-25.
    15. Luca Bonacini & Giovanni Gallo & Sergio Scicchitano, 2021. "Working from home and income inequality: risks of a ‘new normal’ with COVID-19," Journal of Population Economics, Springer;European Society for Population Economics, vol. 34(1), pages 303-360, January.

    More about this item

    Keywords

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    JEL classification:

    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • R31 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Housing Supply and Markets
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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