EconPapers    
Economics at your fingertips  
 

Two-Stage Bargaining with Coverage Extension in a Dual Labour Market

Mark A. Roberts, Karsten Staehr () and Torben Tranaes ()

No 97-28, EPRU Working Paper Series from Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics

Abstract: This paper studies two-stage bargaining in a simple general equilibrium model with a dual labour market. We analyse the case where agreements reached at the central level in the union sector extend beyond this sector. Conditions are identified under which firms and unions have a commonality of interest in extending coverage of a minimum wage to the non-union sector of the economy. In many countries, labour markets comprise a primary sector with high non-market clearing wages and job queues, and a secondary sector with market clearing. The latter arises endogenously in our model: it is optimal for the union sector to impose a market clearing wage on the non-union sector. This suggests that coverage extension can increase welfare.

References: Add references at CitEc
Citations: Track citations by RSS feed

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
Journal Article: Two-stage bargaining with coverage extension in a dual labour market (2000) Downloads
Working Paper: Two-Stage Bargaining with Coverage Extension in a Dual Labour Market (1997) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:kud:epruwp:97-28

Access Statistics for this paper

More papers in EPRU Working Paper Series from Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics Øster Farimagsgade 5, Building 26, DK-1353 Copenhagen K., Denmark. Contact information at EDIRC.
Bibliographic data for series maintained by Thomas Hoffmann ().

 
Page updated 2020-01-17
Handle: RePEc:kud:epruwp:97-28