Employment effects of centralization in wage setting in a median voter model

Abstract

"Most models on centralization in wage setting rest on the assumption of identical firms. This stands in sharp contrast to informal statements against centralization wich rest on the argument that firms are heterogenous and that equal treatment of firms by unions must therefore be ineffcient. We analyse one aspect of this debate in the framework of a median voter model with heterogenous firms but we don't find unique negative employment effects. It may be cumbersome or even impossible to check whether the conditions for unique effects are met. Explorative investigations of the magnitude of the implied effects show however, that they are noteworthy only if differences between firms are large." (Author's abstract, IAB-Doku) ((en))

Cite article

Ludsteck, J. (2006): Employment effects of centralization in wage setting in a median voter model. (IAB-Discussion Paper 02/2006), Nürnberg, 31 p.