Wages, Taxes and the Utility-Maximizing Trade Union: A Confrontationwith Norwegian Data
This paper estimates a model of wage formation where the central assumptions are: (1) exce pt for a random error term, the aggregate wage level is determined by a single t rade union; (2) union utility depends on the real disposable wage and on employm ent; and (3) firmsdetermine employment and react to wage increases by reducing employment. The purpose is to see whether such a theory can be made operational and whether the model can be made to fit reasonably well with Norwegian data (19 62-82). Results are mixed and do not give much support to the approach taken, bu t several possibilities for further refinement remain. Copyright 1986 by Royal Economic Society.
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Volume (Year): 38 (1986)
Issue (Month): 3 (November)
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