IDEAS home Printed from https://ideas.repec.org/p/cte/werepe/6014.html
   My bibliography  Save this paper

Endogenous wage-bargaining institutions in oligopolistic industries

Author

Listed:
  • Petrakis, Emmanuel
  • Vlassis, Minas

Abstract

This paper develops a framework of endogenous formation of wage-bargaining institutions regarding the level at which unions and firms negotiate in industries with market power. We show that economic factors, such as asymmetries in productive efficiency and bargaining power, are responsible for the en~ ',gence of various degrees of bargaining centralization. An all unionefficient firms majorit) coalition typically establishes an extra stage of wage negotiations at the sectorial level. If, for given bargaining powers, the productivity differences are sufficiently high, wage negotiations are also conducted at firm-level. Otherwise, the (minimum) wage bargain struck at the sectorial level is simply confirmed by both, firms and unions. This is a case of complete bargaining centralization. If, however, technological and bargaining power asymmetries cancel out, wage negotiations are conducted only at the firm level (decentralized bargaining).

Suggested Citation

  • Petrakis, Emmanuel & Vlassis, Minas, 1996. "Endogenous wage-bargaining institutions in oligopolistic industries," UC3M Working papers. Economics 6014, Universidad Carlos III de Madrid. Departamento de Economía.
    • Handle: RePEc:cte:werepe:6014
    as

    Download full text from publisher

    File URL: https://e-archivo.uc3m.es/bitstream/handle/10016/6014/we960202.PDF?sequence=1
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Dobson, Paul W., 1994. "Multifirm unions and the incentive to adopt pattern bargaining in oligopoly," European Economic Review, Elsevier, vol. 38(1), pages 87-100, January.
    2. Layard, Richard & Nickell, Stephen & Jackman, Richard, 2005. "Unemployment: Macroeconomic Performance and the Labour Market," OUP Catalogue, Oxford University Press, number 9780199279173.
    3. Richard Jackman & Christopher A. Pissarides & S Savouri, 1990. "Labour Market Policies and Unemployment in the OECD," CEP Discussion Papers dp0011, Centre for Economic Performance, LSE.
    4. Maria Paz Espinosa & Changyong Rhee, 1989. "Efficient Wage Bargaining as a Repeated Game," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 104(3), pages 565-588.
    5. Manning, Alan, 1987. "An Integration of Trade Union Models in a Sequential Bargaining Framework," Economic Journal, Royal Economic Society, vol. 97(385), pages 121-139, March.
    6. De Fraja, Giovanni, 1993. "Staggered vs. synchronised wage setting in oligopoly," European Economic Review, Elsevier, vol. 37(8), pages 1507-1522, December.
    7. Byoung Heon Jun, 1989. "Non-cooperative Bargaining and Union Formation," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 56(1), pages 59-76.
    8. Corneo, Giacomo, 1993. "Idiosyncratic wage bargaining in an oligopolistic single market," CEPREMAP Working Papers (Couverture Orange) 9313, CEPREMAP.
    9. McDonald, Ian M & Solow, Robert M, 1981. "Wage Bargaining and Employment," American Economic Review, American Economic Association, vol. 71(5), pages 896-908, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Vannetelbosch, Vincent J., 1997. "Wage bargaining with incomplete information in an unionized Cournot oligopoly," European Journal of Political Economy, Elsevier, vol. 13(2), pages 353-374, May.
    2. Emmanuel Petrakis & Minas Vlassis, 2004. "Endogenous wage bargaining institutions in oligopolistic sectors," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 24(1), pages 55-73, July.
    3. Haucap, Justus & Pauly, Uwe & Wey, Christian, 2001. "Collective wage setting when wages are generally binding An antitrust perspective," International Review of Law and Economics, Elsevier, vol. 21(3), pages 287-307, September.
    4. Kollintzas, Tryphon & Vassilatos, Vanghelis, 2000. "A small open economy model with transaction costs in foreign capital," European Economic Review, Elsevier, vol. 44(8), pages 1515-1541, August.
    5. Petrakis, Emmanuel & Vlassis, Minas, 2003. "Minimum wages in national and internationally integrated economies," Journal of Policy Modeling, Elsevier, vol. 25(3), pages 257-265, April.
    6. Petrakis, Emmanuel & Vlassis, Minas, 2000. "Endogenous scope of bargaining in a union-oligopoly model: when will firms and unions bargain over employment?," Labour Economics, Elsevier, vol. 7(3), pages 261-281, May.
    7. Paul Heidhues, 2000. "Employers’ Associations, Industry-wide Unions, and Competition," CIG Working Papers FS IV 00-11, Wissenschaftszentrum Berlin (WZB), Research Unit: Competition and Innovation (CIG).
    8. Petrakis, Emmanuel & Vlassis, Minas, 1996. "Endogenous scope of bargaining in oligopoly," UC3M Working papers. Economics 3978, Universidad Carlos III de Madrid. Departamento de Economía.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Paul Heidhues, 2000. "Employers’ Associations, Industry-wide Unions, and Competition," CIG Working Papers FS IV 00-11, Wissenschaftszentrum Berlin (WZB), Research Unit: Competition and Innovation (CIG).
    2. António Brandão & Joana Pinho, 2018. "Productivity Shocks in a Union‐Duopoly Model," Manchester School, University of Manchester, vol. 86(6), pages 722-756, December.
    3. Bárcena Ruiz, Juan Carlos & Campo Corredera, María Luz, 2003. "Timing of Wage Setting when Firms Invest in R&D," IKERLANAK 1134-8984, Universidad del País Vasco - Departamento de Fundamentos del Análisis Económico I.
    4. Domenico Buccella, 2015. "Unionized duopoly, market competition with differentiated products, and welfare," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 42(4), pages 455-473, December.
    5. Sanz, Nicolas & Schwartz, Sonia, 2013. "Are pollution permit markets harmful for employment?," Economic Modelling, Elsevier, vol. 35(C), pages 374-383.
    6. Domenico Buccella, 2014. "Product market competition with differentiated goods and social welfare in the presence of an industry-wide union," Portuguese Economic Journal, Springer;Instituto Superior de Economia e Gestao, vol. 13(2), pages 131-140, August.
    7. Chica Páez, Yolanda & Espinosa Alejos, María Paz, 2005. "Union Formation and Bargaining Rules in the Labor Market," DFAEII Working Papers 1988-088X, University of the Basque Country - Department of Foundations of Economic Analysis II.
    8. Juan Carlos Bárcena‐Ruiz & M. Luz Campo, 2009. "R&D Investments And Sequential Wage Negotiations," Australian Economic Papers, Wiley Blackwell, vol. 48(3), pages 183-202, September.
    9. Petrakis, Emmanuel & Vlassis, Minas, 2000. "Endogenous scope of bargaining in a union-oligopoly model: when will firms and unions bargain over employment?," Labour Economics, Elsevier, vol. 7(3), pages 261-281, May.
    10. Grandner, Thomas, 1998. "Market shares of price setting firms and trade unions," Department of Economics Working Paper Series 61, WU Vienna University of Economics and Business.
    11. Thomas Grandner, 1998. "Market Shares of Price Setting Firms and Trade Unions," Department of Economics Working Papers wuwp061, Vienna University of Economics and Business, Department of Economics.
    12. Kuhn, Peter & Gu, Wulong, 1998. "Centralization and strikes," Labour Economics, Elsevier, vol. 5(3), pages 243-265, September.
    13. Barcena-Ruiz, Juan Carlos, 2003. "Politically preferred wage bargaining structures," European Journal of Political Economy, Elsevier, vol. 19(2), pages 341-353, June.
    14. Emmanuel Petrakis & Minas Vlassis, 1999. "The strategic role of minimum sectorial wages in oligopoly: a case for the Spanish labour market," Investigaciones Economicas, Fundación SEPI, vol. 23(3), pages 331-350, September.
    15. Grandner, Thomas, 2001. "Unions in oligopolistic, vertically connected industries," European Economic Review, Elsevier, vol. 45(9), pages 1723-1740, October.
    16. Schultz, Christian, 1997. "Wages and employment in a repeated game with revenue fluctuations," European Economic Review, Elsevier, vol. 41(1), pages 147-162, January.
    17. Frank Scharr, 2005. "Tarifbindung, Rententeilung und Konzessionsverträge als Einflussgrößen der Lohnhöhe in Unternehmen : eine Untersuchung mit Mikrodaten für thüringische Firmen," ifo Dresden Studien, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, number 39, July.
    18. Domenico Buccella & Luciano Fanti, 2017. "A game-theoretic approach to the choice of union-oligopoly baargaining agenda," Discussion Papers 2017/214, Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy.
    19. repec:pri:indrel:dsp01cc08hf62w is not listed on IDEAS
    20. Fanti, Luciano & Buccella, Domenico, 2015. "Bargaining agenda, timing, and entry," MPRA Paper 64089, University Library of Munich, Germany.

    More about this item

    Keywords

    Bargaining institutions;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cte:werepe:6014. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Ana Poveda (email available below). General contact details of provider: http://www.eco.uc3m.es/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.