Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/43126
Authors: 
Gartner, Hermann
Schank, Thorsten
Schnabel, Claus
Year of Publication: 
2010
Series/Report no.: 
Diskussionspapiere // Universität Erlangen-Nürnberg, Lehrstuhl für Arbeitsmarkt- und Regionalpolitik 70
Abstract: 
Since there is scant evidence on the role of industrial relations in wage cyclicality, this paper analyzes the effect of collective wage contracts and of works councils on real wage growth. Using linked employer-employee data for western Germany, we find that works councils affect wage growth only in combination with collective bargaining. Wage adjustments to positive and negative economic shocks are not always symmetric. Only under sectoral bargaining there is a (nearly symmetric) reaction to rising and falling unemployment. In contrast, wage growth in establishments without collective bargaining adjusts only to falling unemployment and is unaffected by rising unemployment.
Subjects: 
wage cyclicality
wage bargaining
works council
Germany
JEL: 
J31
E32
J53
Document Type: 
Working Paper

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