The impact of centralized bargaining on spillovers and the wage structure in monopsonistic labour markets

Abstract

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How to strengthen the institutions of work

“…In South Africa, firms excluded from collective agreements tend to increase wages in line with those mandated by bargaining councils. 163 The negative relationship between the unexplained pay gap and collective bargaining coverage, presented in figure 5.9 (panel B) suggests that collective bargaining may help reduce inequalities in pay between key and other employees that are unrelated to skills. This is in line with studies highlighting that collective bargaining helps redress "structural" wage inequalities, such as those observed between male and female employees, that arise from a systematic undervaluation of women's work.…”

Collective bargaining and power: Wage premium of collective agreements in Europe 2002–2018

“…A stronger bargaining position is expected to increase earnings of the workers covered by these agreements, but may also affect wages of the non‐covered workers, akin to the spillover effects through threats of unionisation (Denice & Rosenfeld, 2018; Western & Rosenfeld, 2011). Indeed, firms not bound by collective agreements themselves may still choose to adhere to these agreements within a local labour market (Bassier, 2022). Such spillovers of the collective agreement would be expected especially in sectors where a large proportion of workplaces are bound by agreements, or where competition for workers is higher.…”

Labor Market Frictions and Spillover Effects from Publicly Announced Sectoral Minimum Wages

“…To shed light on demand-side responses and to compare the results with the existing empirical evidence on cross-employer spillover effects (Staiger et al, 2010;Derenoncourt et al, 2021;Bassier, 2021), I analyze the spillover effects from the main construction sector minimum wage from the perspective of establishments.…”

“…This paper contributes to an emerging literature on cross-employer spillover effects of wage-setting changes at major employers in three ways (Staiger et al, 2010;Derenoncourt et al, 2021;Bassier, 2021). 5 First, I am able to analyze the supply side spillover response to sectoral minimum wages using social security administrative data, which reveals reallocation effects that were previously obscured in firm-level studies.…”

“…Although examining spillover effects from sectoral minimum wages on firms and workers outside the targeted sector would contribute significantly to our understanding of the existence, types, and consequences of labor market frictions, the empirical evidence on spillover effects and its mechanisms is scarce (Staiger et al, 2010;Derenoncourt et al, 2021;Bassier, 2021). 1 Three challenges have prevented researchers from studying spillover effects.…”