The rise and fall of centralized wage bargaining

Salvador Ortigueira

UC3M Working papers. Economics from Universidad Carlos III de Madrid. Departamento de Economía

Abstract: During the three decades spanning the early 50’s to the early 80’s, the wagesetting process in most Northern European countries was dominated by centralized bargaining, where peak level labor and employer associations set wages nationwide. In the early 80’s centralized wage bargaining began to collapse. In this paper we assess a novel explanation both for the initial establishment of a centralized wagesetting process, and for its subsequent collapse. According to our theory, centralized wage bargaining was set up as a response to the spillovers created by the unemployment benefit program. Its collapse was the result of the increase in the productivity gap across workers, brought about by equipment-specific technological progress and equipment-skill complementarity

Keywords: Wage-Bargaining; Arrangements; Unemployment; Benefits; Equipment-Specific; Technological; Progress; Equipment-Skill; Complementarity (search for similar items in EconPapers)
JEL-codes: J31 J41 J51 (search for similar items in EconPapers)
Date: 2011-08-29
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Related works:
Journal Article: The Rise and Fall of Centralized Wage Bargaining (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:cte:werepe:we1129

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