E. Barth et J. Zweimuller, RELATIVE WAGES UNDER DECENTRALIZED AND CORPORATIST BARGAINING SYSTEMS, The Scandinavian journal of economics, 97(3), 1995, pp. 369-384
In studying the relationship between wage inequality and centralizatio
n in collective bargaining, we distinguish central from local systems
of wage determination by assuming that a central union takes the emplo
yment effects of negotiated wages into account, whereas unions disrega
rd these effects in decentralized systems. Two different sources of wa
ge differentials are studied separately: (i) heterogeneous workers wit
h different skills and (ii) heterogeneous firms with varying levels of
economic rent per employee. With respect to skill levels, the impact
of centralization is ambiguous, whereas inter-firm wage differentials
are likely to be lower in corporatist systems.