INSTITUTIONAL AND MARKET DETERMINANTS OF WAGE SPILLOVERS - EVIDENCE FROM UAW PATTERN BARGAINING

Empirical wage spillovers are often observed, but their theoretical ex planation is controversial because they are consistent with institutio nal wage comparisons stemming from fairness or union politics, but als o with neoclassical alternative wages or correlated labor demand shock s. The nature of wage spillovers is analyzed using a data set of Unite d Automobile, Aerospace, and Agricultural Implement Workers of America (UAW) wage settlements, The results support the hypothesis that insti tutional wage spillovers augment neoclassical economic forces in deter mining wages, albeit with some weakening after 1980.