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Insiders and Outsiders in Wage Formation: The Dutch Case

Johan Graafland

Empirical Economics, 1992, vol. 17, issue 4, 583-602

Abstract: In this paper the relevance of the insider-outsider theory is investigated for the Netherlands. Estimation results of a macro wage equation show that the insider-outsider distinction has some empirical relevance, because the pay-off rate has a significant negative influence on wages. However, the extreme insider-outsider model is rejected, because wages are also found to be significantly negatively related to the rate of long-term unemployment.

Date: 1992
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