Rent-Sharing and Collective Bargaining Coverage

Download or read book Rent-Sharing and Collective Bargaining Coverage written by Nicole Guertzgen and published by . This book was released on 2009 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Using a linked employer-employee dataset, 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- and 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, are associated with a significantly lower responsiveness of wages to firm-level profitability.