Centralised Labour Market Negotiations: Strategic Behaviour Curbs Employment

Julia Müller () and Thorsten Upmann

Journal of Institutional and Theoretical Economics (JITE), 2018, vol. 174, issue 2, 278-302

Abstract: This paper contributes to the analysis of centralised versus decentralised labour market negotiations. Applying the familiar Nash bargaining solution, we show that centralised negotiations lead to a lower employment level but to a higher wage rate than decentralised labour market bargaining. While this is an important theoretical result on its own, it has important effects for both empirical labour market research and labour market policies. Also, this result counters the critique that efficient negotiations result in employment levels exceeding the competitive level.

Keywords: centralised and decentralised labour market negotiations; efficient bargains; Nash bargaining solution; wage and employment effects; endogenous output price (search for similar items in EconPapers)
JEL-codes: C78 D41 J52 (search for similar items in EconPapers)
Date: 2018
References: Add references at CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
https://www.mohrsiebeck.com/en/article/centralised ... 45617x14930170168706 (text/html)
Fulltext access is included for subscribers to the printed version.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:mhr:jinste:urn:sici:0932-4569(201806)174:2_278:clmnsb_2.0.tx_2-y

Ordering information: This journal article can be ordered from
Mohr Siebeck GmbH & Co. KG, P.O.Box 2040, 72010 Tübingen, Germany

DOI: 10.1628/093245617X14930170168706

Access Statistics for this article

Journal of Institutional and Theoretical Economics (JITE) is currently edited by Gerd Mühlheußer and Bayer, Ralph-C

More articles in Journal of Institutional and Theoretical Economics (JITE) from Mohr Siebeck, Tübingen
Bibliographic data for series maintained by Thomas Wolpert ().