Bargaining, Compensating Wage Differentials, and Dualism of the Labor Market: Theory and Evidence for France

Christophe Daniel and Catherine Sofer ()
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Christophe Daniel: LEO - Laboratoire d'économie d'Orleans [2008-2011] - UO - Université d'Orléans - CNRS - Centre National de la Recherche Scientifique

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Abstract: The theory of compensating differentials predicts a negative relationship between wages and good working conditions, while the theory of segmentation predicts a positive one. Combining the hedonic wage model and the wages‐employment collective bargaining model, we show the relevance of a further factor: a union power effect. Then we test the validity of this effect with French cross‐section data. Empirical results confirm the predictions of the model, that is, the coexistence of a negative relationship between wages and good working conditions for the whole sample (market effect) and a positive relationship in highly unionized sectors (union power effect).

Keywords: Compensating; Wage; Differentials (search for similar items in EconPapers)
Date: 1998-07
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Citations: View citations in EconPapers (32)

Published in Journal of Labor Economics, 1998, 16 (3), pp.546-575. ⟨10.1086/209898⟩

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Related works:
Journal Article: Bargaining, Compensating Wage Differentials, and Dualism of the Labor Market: Theory and Evidence for France (1998)
Working Paper: Bargaining, Compensating Wage Differentials, and Dualism of the Labor Market: Theory and Evidence from France (1998)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:halshs-00367153

DOI: 10.1086/209898

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