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Unions and Collective Bargaining in the Wake of the Great Recession

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Listed:
  • Addison, John T.

    (Durham University Business School)

  • Portugal, Pedro

    (Banco de Portugal)

  • Vilares, Hugo

    (London School of Economics)

Abstract

This paper provides the first definitive estimates of union density in Portugal, 2010-2012, using a unique dataset. The determinants of union density at firm level are first modeled. Next, we draw upon a very recent study of the union wage premium to provide summary estimates of the union wage gap for different ranges of union density. Since these estimates fully reflect the reality of an industrial relations system in which collective agreements are extended to nonunion workers and firms, the final issue examined is contract coverage. Although there has occurred a pronounced fall in the number of new extension agreements in recent years, this decline has been uncritically linked with a fall in coverage. We show that the number of workers covered by new and existing agreements has been largely unaffected by economic crisis. The reduced frequency of new agreements and extensions is viewed as an aspect of downward nominal wage rigidity in deflationary times (the counterpart of "upward nominal wage rigidity" in more normal times) rather than the immediate expression of a crisis in collective bargaining per se.

Suggested Citation

  • Addison, John T. & Portugal, Pedro & Vilares, Hugo, 2015. "Unions and Collective Bargaining in the Wake of the Great Recession," IZA Discussion Papers 8943, IZA Network @ LISER.
    • Handle: RePEc:iza:izadps:dp8943
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    References listed on IDEAS

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    1. repec:ptu:bdpart:e201606 is not listed on IDEAS
    2. Carneiro, Anabela & Portugal, Pedro & Varejão, José, 2013. "Catastrophic Job Destruction," IZA Discussion Papers 7670, IZA Network @ LISER.
    3. John T. Addison & Claus Schnabel (ed.), 2003. "International Handbook of Trade Unions," Books, Edward Elgar Publishing, number 2705, June.
    4. Pedro S. Martins, 2021. "30,000 Minimum Wages: The Economic Effects of Collective Bargaining Extensions," British Journal of Industrial Relations, London School of Economics, vol. 59(2), pages 335-369, June.
    5. David S. Lee & Alexandre Mas, 2012. "Long-Run Impacts of Unions on Firms: New Evidence from Financial Markets, 1961--1999," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 127(1), pages 333-378.
    6. Paulo Guimarães & Pedro Portugal & Anabela Carneiro, 2009. "Real Wages and the Business Cycle: Accounting for Worker and Firm Heterogeneity," Working Papers w200910, Banco de Portugal, Economics and Research Department.
    7. Ana Rute Cardoso & Pedro Portugal, 2005. "Contractual Wages and the Wage Cushion under Different Bargaining Settings," Journal of Labor Economics, University of Chicago Press, vol. 23(4), pages 875-902, October.
    8. Guimaraes, Paulo & Martins, Fernando & Portugal, Pedro, 2017. "Upward Nominal Wage Rigidity," IZA Discussion Papers 10510, IZA Network @ LISER.
    9. Anabela Carneiro & Paulo Guimarães & Pedro Portugal, 2012. "Real Wages and the Business Cycle: Accounting for Worker, Firm, and Job Title Heterogeneity," American Economic Journal: Macroeconomics, American Economic Association, vol. 4(2), pages 133-152, April.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

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    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J52 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Dispute Resolution: Strikes, Arbitration, and Mediation
    • J53 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Labor-Management Relations; Industrial Jurisprudence

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