Rent-Sharing and Collective Bargaining Coverage: Evidence from Linked Employer-Employee Data

Nicole Gürtzgen
Authors registered in the RePEc Author Service: Nicole Guertzgen ()

No 05-90 [rev.], ZEW Discussion Papers from ZEW - Leibniz Centre for European Economic Research

Abstract: Using a linked employer-employee data set, this paper analyses the relationship between firm profitability and wages. Particular emphasis is given to the question of whether the sensitivity of wages to firm-specific rents varies with collective bargaining coverage. To address this issue, we distinguish sector-specific wage agreements, firm-specific wage agreements and wage determination without any bargaining coverage. Our findings indicate that individual wages are positively related to firm-specific quasi-rents in the non-union sector and under firm-specific contracts. Industry-wide wage contracts, however, seem to suppress firm-level rent-sharing. While pooled OLS estimates yield a positive correlation between wages and quasirents under centralised contracts, estimates accounting for unobserved individual and establishment heterogeneity point to a coefficient of zero. Finally, GMM estimates using suitable lagged values as instruments indicate that this result appears to be robust to the endogeneity of quasi-rents.

Keywords: Rent-Sharing; Unions; Linked Employer-Employee Data (search for similar items in EconPapers)
JEL-codes: C23 J31 J51 (search for similar items in EconPapers)
Date: 2006
References: Add references at CitEc
Citations: View citations in EconPapers (3)

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Related works:
Journal Article: Rent‐sharing and Collective Bargaining Coverage: Evidence from Linked Employer–Employee Data (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:zewdip:7185

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