Real Wage Determinatioan in Collective BArgaining Agreements / Louis N. Christofides, Andrew J. Oswald.

Format:

Book

Author/Creator:

Christofides, Louis N.

Contributor:

National Bureau of Economic Research.

Oswald, Andrew J.

Series:

Working Paper Series (National Bureau of Economic Research) no. w3188.

NBER working paper series no. w3188

Language:

English

Subjects (All):

Collective bargaining.

Wages--Effect of technological innovations on.

Wages.

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 1989.

Cambridge, Massachusetts : National Bureau of Economic Research, 1989.

Summary:

This paper studies the determinants of real wage rates using data on Canadian labour contracts signed between 1978 and 1984. Its results are consistent with Dunlop's neglected (1944) hypothesis that real pay movements are shaped by product price changes (contrary to the predictions of implicit contract theory and other models of wage inflexibility). The level of the unemployment rate is found to lower the real wage level with an elasticity between -0.04 and -0.13, whereas a Phillips Curve specification which relates wage changes to the level of the unemployment rate is not convincingly supported by the data. These results may be seen as consistent with the view that collective bargaining is a form of rent-sharing in which external unemployment weakens workers' bargaining strength.

Notes:

Print version record

November 1989.