Arbeitspapier

Central wage bargaining and local wage flexibility: evidence from the entire wage distribution

We argue that in labor markets with central wage bargaining wage flexibility varies systematically across the wage distribution: local wage flexibility is more relevant for the upper part of the wage distribution, and flexibility of wages negotiated under central wage bargaining affects the lower part of the wage distribution. Using a random sample of German social{security accounts, we estimate wage flexibility across the wage distribution by means of quantile regressions. The results support our hypothesis, as employees with low wages have significantly lower local wage flexibility than high wage employees. This effect is particularly relevant for the lower educational groups. On the other hand, employees with low wages tend to have a higher wage flexibility with respect to national unemployment.

Language
Englisch

Bibliographic citation
Series: ZEW Discussion Papers ; No. 98-39

Classification
Wirtschaft
Subject
Central wage bargaining
Wage flexibility
Quantile regression
Lohnpolitik
Lohnstruktur
Regionale Lohnstruktur
Lohnrigidität
Schätzung
Deutschland

Event
Geistige Schöpfung
(who)
Büttner, Thiess
Fitzenberger, Bernd
Event
Veröffentlichung
(who)
Zentrum für Europäische Wirtschaftsforschung (ZEW)
(where)
Mannheim
(when)
1998

Handle
Last update
10.03.2025, 11:43 AM CET

Data provider

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Object type

  • Arbeitspapier

Associated

  • Büttner, Thiess
  • Fitzenberger, Bernd
  • Zentrum für Europäische Wirtschaftsforschung (ZEW)

Time of origin

  • 1998

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