Centralization of Wage Bargaining and Macroeconomic Performance
1987 (English)Report (Other academic)
Differences in macroeconomic performance among countries are often attributed to differences in wage setting structures. This paper examines the effects of varying degrees of centralization of wage bargaining. The analysis is both theoretical and empirical, and also includes numerical examples. The upshot is that both highly centralized systems with national bargaining (such as in Austria and the Nordic countries), and highly decentralized systems with wage setting at the level of individual firms (such as Japan, Switzerland and the US) are likely to perform well. The worst outcomes with respect to employment are to be expected in systems with an intermediate degree of centralization (such as in Belgium and the Netherlands). These conclusions challenge the conventional wisdom according to which more "corporatist" economies always perform better then less "corporatist" ones.
Place, publisher, year, edition, pages
Stockholm: IIES , 1987. , 70 p.
Seminar Paper / Institute for International Economic Studies, Stockholm University, ISSN 0347-8769 ; 402
IdentifiersURN: urn:nbn:se:su:diva-41585OAI: oai:DiVA.org:su-41585DiVA: diva2:331424