Equilibrium Unemployment Under Negotiated Profit Sharing

Arbeitspapier

We study employment, employee effort, wages and profit sharing when firms face stochastic revenue shocks and when base wages and profit shares are determined through negotiations. The negotiated profit share depends positively on the relative bargaining power of the trade union and it has effort-enhancing and wage-moderating effects. We show that higher profit sharing reduces equilibrium unemployment under circumstances with sufficiently ?rigid? labour market institutions, i.e. sufficiently high benefit-replacement ratios and relative bargaining powers of trade unions. Conversely, profit sharing seems to be destructive from the point of view of employment when the labour market ?rigidities? are sufficiently small.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: IZA Discussion Papers ; No. 840

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Labor Contracts ; Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill ; Trade Unions: Objectives, Structure, and Effects
• Thema: bargaining ; profit sharing ; efficiency wages ; equilibrium unemployment ; Tarifliche Gewinnbeteiligung ; Lohnverhandlungstheorie ; Effizienzlohn ; Theorie der Arbeitslosigkeit ; Arbeitsmarktflexibilisierung ; Theorie

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Koskela, Erkki ; Stenbacka, Rune
• Ereignis: Veröffentlichung
• (wer): Institute for the Study of Labor (IZA)
• (wo): Bonn
• (wann): 2003

Weitere Informationen

• Handle: http://hdl.handle.net/10419/20084
• Letzte Aktualisierung: 10.03.2025, 11:45 MEZ