Wage Differentials by Bargaining Regime in Spain (2002-2014): An Analysis Using Matched Employer-Employee Data

Raul Ramos, Esteban Sanroma and Hipolito Simon (hsimon@ua.es)

No 12013, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: This research examines wage differentials associated to different collective bargaining regimes in Spain and their evolution over time based on matched employer-employee microdata. The primary objective is to analyse the wage differentials associated to the presence of a firm-level agreement and how they have evolved, taking into account the changes in the economic cycle and the recent labour reform of 2012. The second objective of the study is to examine the impact on wages of an absence of a collective agreement. This regime has become more prevalent due to the regulatory changes associated to the labour reform. From the evidence obtained it may be concluded that, although the higher wages observed in company-level agreements are systematically explained by the better characteristics of firms with labour agreements, there is a positive wage premium that favours workers mostly in the middle and upper-middle end of the wage distribution. This premium has remained relatively stable over time and does not seem to have been affected by the reform, although a degree of cyclical evolution cannot be ruled out. With respect to the impact on wages of the absence of a collective agreement, the results suggest that this level of bargaining, which is still fairly scarce, despite displaying an increasing trend, is associated, on average, to comparatively low wages, and, consequently, to higher wage flexibility. The principal explanatory cause for this wage differential is the existence of a negative wage premium for workers of firms covered by sectoral agreements, particularly those at the lower end of the distribution.

Keywords: decomposition methods; wage differentials; collective bargaining; economic cycle (search for similar items in EconPapers)
JEL-codes: J31 J51 (search for similar items in EconPapers)
Pages: 41 pages
Date: 2018-12
New Economics Papers: this item is included in nep-eur and nep-lab
References: View references in EconPapers View complete reference list from CitEc
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Published - published in: Journal of Policy Modeling, 2022, 44 (2), 375-395

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Working Paper: Wage differentials by bargaining regime in Spain (2002-2014). An analysis using matched employer-employee data (2018)
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