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Bargaining, Compensating Wage Differentials, and Dualism of the Labor Market: Theory and Evidence for France

Author

Listed:
  • Christophe Daniel

    (LEO - Laboratoire d'économie d'Orleans - UO - Université d'Orléans - CNRS - Centre National de la Recherche Scientifique)

  • Catherine Sofer

    () (LEO - Laboratoire d'économie d'Orleans - UO - Université d'Orléans - CNRS - Centre National de la Recherche Scientifique)

Abstract

The theory of compensating differentials predicts a negative relationship between wages and good working conditions, while the theory of segmentation predicts a positive one. Combining the hedonic wage model and the wages‐employment collective bargaining model, we show the relevance of a further factor: a union power effect. Then we test the validity of this effect with French cross‐section data. Empirical results confirm the predictions of the model, that is, the coexistence of a negative relationship between wages and good working conditions for the whole sample (market effect) and a positive relationship in highly unionized sectors (union power effect).

Suggested Citation

  • Christophe Daniel & Catherine Sofer, 1998. "Bargaining, Compensating Wage Differentials, and Dualism of the Labor Market: Theory and Evidence for France," Post-Print halshs-00367153, HAL.
  • Handle: RePEc:hal:journl:halshs-00367153
    DOI: 10.1086/209898
    Note: View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-00367153
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    References listed on IDEAS

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    Cited by:

    1. Mikael Carlsson & Julián Messina & Oskar Nordström Skans, 2016. "Wage Adjustment and Productivity Shocks," Economic Journal, Royal Economic Society, vol. 126(595), pages 1739-1773, September.
    2. Cristian Bartolucci & Francesco Devicienti, 2012. "Better Workers Move to Better Firms: A Simple Test to Identify Sorting," Carlo Alberto Notebooks 259, Collegio Carlo Alberto.
    3. Paul Frijters, 2001. "Unemployment benefits and educational choices," School of Economics and Finance Discussion Papers and Working Papers Series 099a, School of Economics and Finance, Queensland University of Technology.
    4. Fernández, Rosa M. & Nordman, Christophe J., 2009. "Are there pecuniary compensations for working conditions?," Labour Economics, Elsevier, vol. 16(2), pages 194-207, April.
    5. Böckerman, Petri & Ilmakunnas, Pekka, 2008. "Interaction of working conditions, job satisfaction, and sickness absences: Evidence from a representative sample of employees," Social Science & Medicine, Elsevier, vol. 67(4), pages 520-528, August.
    6. repec:eme:rleczz:s0147-9121(2013)0000038005 is not listed on IDEAS
    7. Climent Quintana-Domeque, 2008. "Preferences, Comparative Advantage, and Compensating Wage Differentials for Job Routinization," Working Papers 1063, Princeton University, Department of Economics, Industrial Relations Section..
    8. Climent Quintana‐Domeque, 2011. "Preferences, Comparative Advantage, and Compensating Wage Differentials for Job Routinization," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 73(2), pages 207-229, April.
    9. Solé, Meritxell & Díaz Serrano, Lluís & Rodríguez, Marisol, 2010. "Work, risk and health: differences between immigrants and natives in Spain," Working Papers 2072/151548, Universitat Rovira i Virgili, Department of Economics.
    10. Bocquier, Philippe & Nordman, Christophe J. & Vescovo, Aude, 2010. "Employment Vulnerability and Earnings in Urban West Africa," World Development, Elsevier, vol. 38(9), pages 1297-1314, September.
    11. Nikolaos Georgantzis & Efi Vasileiou, 2014. "Are Dangerous Jobs Paid Better? European Evidence," Research in Labor Economics,in: New Analyses of Worker Well-Being, volume 38, pages 163-192 Emerald Publishing Ltd.
    12. Böckerman, Petri & Ilmakunnas, Pekka & Vainiomäki, Jari, 2014. "Using Twins to Resolve the Twin Problem of Having a Bad Job and a Low Wage," IZA Discussion Papers 8557, Institute for the Study of Labor (IZA).
    13. Böckerman, Petri & Ilmakunnas, Pekka, 2007. "Job disamenities, job satisfaction, quit intentions, and actual separations: putting the pieces together," MPRA Paper 3245, University Library of Munich, Germany.
    14. StÈphane Bonhomme & GrÈgory Jolivet, 2009. "The pervasive absence of compensating differentials," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 24(5), pages 763-795.
    15. repec:dau:papers:123456789/4294 is not listed on IDEAS
    16. Ambra Poggi, 2007. "Do Satisfactory Working Conditions Contribute to Explaining Earning Differentials in Italy? A Panel Data Approach," LABOUR, CEIS, vol. 21(4-5), pages 713-733, December.
    17. Solé, Meritxell & Diaz-Serrano, Luis & Rodriguez Martinez, Marisol, 2010. "Work, Risk and Health: Differences between Immigrants and Natives in Spain," IZA Discussion Papers 5338, Institute for the Study of Labor (IZA).
    18. Ndamsa Dickson Thomas & Baye Mendjo Francis & Epo Boniface Ngah, 2013. "Responsiveness of Private Sector Household Income to Employment Vulnerability in Cameroon," EuroEconomica, Danubius University of Galati, issue 1(32), pages 153-177, May.
    19. Jaime Alonso-Carrera & Jordi Caballé & Xavier Raurich, 2016. "Intergenerational Mobility, Occupational Decision and the Distribution of Wages," Working Papers 945, Barcelona Graduate School of Economics.

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    Compensating Wage Differentials;

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