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Decentralization of wage determination: Evidence from a national teacher reform

Alexander Willén ()

Journal of Public Economics, 2021, vol. 198, issue C

Abstract: This paper presents new evidence on the labor market effects of wage decentralization, exploiting a Swedish reform that replaced the fixed national pay scale for teachers with individual wage bargaining. The paper provides three sets of results. First, I show that the reform significantly changed the wage structure of teachers. Second, I demonstrate that these wage changes did not impact teacher retention, recruitment, or composition, and did not affect student outcomes. Finally, I provide suggestive evidence of a wage spillover effect to substitute occupations. I propose that the suggestive spillover effect helps explain the null results on teacher and student outcomes.

Keywords: Wage regulation; Decentralization; Teacher labor market (search for similar items in EconPapers)
JEL-codes: I20 I28 J31 J45 (search for similar items in EconPapers)
Date: 2021
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Working Paper: Decentralization of wage determination. Evidence from a national teacher reform (2019) Downloads
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DOI: 10.1016/j.jpubeco.2021.104388

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