Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/83129
Authors: 
Forslund, Anders
Gottfries, Nils
Westermark, Andreas
Year of Publication: 
2008
Series/Report no.: 
Working Paper, Department of Economics, Uppsala University 2005:18
Abstract: 
According to the standard union bargaining model, unemployment benefits should have big effects on wages, but product market prices and productivity should play no role in the wage bargain. We formulate an alternative strategic bargaining model, where labour and product market conditions together determine wages. A wage equation is derived and estimated on aggregate data for the Nordic countries. Wages are found to depend on unemployment and the replacement ratio, but also on productivity, international prices and exchange rates. There is evidence of considerable nominal wage rigidity. Exchange rate changes have large and persistent effects on competitiveness.
Subjects: 
non-cooperative bargain
efficiency wage
turnover
wage share
wage curve
JEL: 
E52
F33
F41
J31
J51
J63
J64
Document Type: 
Working Paper

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