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Title:The Effects of Union Wage-Settings on Firms' Production Factor Decisions PDF Logo
Authors:Heshmati, Almas
Haouas, Ilham
Issue Date:2003
Series/Report no.:IZA Discussion paper series 689
Abstract:This study is concerned with the development of a theoretical model and its empirical application to the estimation of the interaction between firms and trade union in determining wages and employment. The focus is on analyzing the effects of unions? demands on the firm?s choice of factors of production. In a two-step process the union and firm determine wages and capital stock, conditional on which the firm decides on production factors of employment, working hours and capital operating time. We suggest the use of a panel data approach applied to manufacturing data. A dynamic model is specified in which the optimal levels of the variables of interest and the speed of their adjustments are modeled in terms of observable policy variables.
Subjects:wage bargaining
employment
capital stock
work hours
capital operating time
manufacturing
panel data
JEL:J50
C33
E24
L60
D21
Document Type:Working Paper
Appears in Collections:IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)

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