Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/223701 
Year of Publication: 
2020
Series/Report no.: 
IZA Discussion Papers No. 13259
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
Coordination in collective wage setting can constrain potential monopoly gains to unions in non-traded-goods industries. Countries with national wage coordination can thus stabilize overall employment against fluctuations and shocks in the world economy. We test this theory by exploring within-country variation in exposure to competition from China in 13 European countries. Our causal estimates demonstrate that in countries with uncoordinated wage setting, regions with higher import exposure from China experienced a marked fall in employment, while countries with wage-coordination experienced no such employment effects. We test our main mechanism against other explanations, and show that our findings are robust to alternative measures of wage coordination, industry classifications, and trade exposure.
Subjects: 
wage-coordination
employment
globalization
China-shock
JEL: 
F16
F66
J51
J60
Document Type: 
Working Paper

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