Imperfect Goods and Labor Markets, and the Union Wage Gap

Helge Sanner

No 55, Volkswirtschaftliche Diskussionsbeiträge from Universität Potsdam, Wirtschafts- und Sozialwissenschaftliche Fakultät

Abstract: Existing theoretical literature fails to explain the differences between the pay of workers that are covered by union agreements and others who are not. This study aims at closing this gap by a single general- equilibrium approach that integrates a dual labor market and a two- sector product market. Our results suggest that the so­ called 'union wage gap' is largely determined by the degree of centralization of the bargains, and, to a somewhat lesser extent, by the expenditure share of the unionized sector's goods.

Keywords: Monopolistic competition; Dual labor market; Wage bargaining; Trade unions (search for similar items in EconPapers)
JEL-codes: D43 D58 J31 J51 (search for similar items in EconPapers)
Date: 2003
New Economics Papers: this item is included in nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

Forthcoming in Journal of Population Economics

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Journal Article: Imperfect goods and labor markets, and the union wage gap (2006)
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Persistent link: https://EconPapers.repec.org/RePEc:pot:vwldis:55

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