Dynamic Equilibria in Wage Bargaining with Quantitative Evidence
نویسنده
چکیده
This paper considers dynamic equilibria in wage bargaining unifying for the rst time the models of Coles and Wright (1998) and Pissarides and producing in contrast to the Coles and Wright model, a non-de cient equilibrium. In sharp contrast to the Pissarides model we analyse a fully dynamic model with non-linear cost functions and risk-averse agents with empirical/quantitative evidence also for the rst time, to provide overall, saddle-path stability and unique wage and employment outcome which is devoid of limit cycles.
منابع مشابه
On-the-job search and strategic bargaining
This paper studies wage bargaining in a simple economy in which both employed and unemployed workers search for better jobs. The axiomatic Nash bargaining solution and standard strategic bargaining solutions are inapplicable because the set of feasible payoffs is nonconvex. I instead develop a strategic model of wage bargaining between a single worker and firm that is applicable to such an envi...
متن کاملWage and Employment Determination through Non-Cooperative Bargaining1
This paper investigates wage and employment determination by a group of workers or union and a rm, making use of the techniques of non-cooperative bargaining. Previous analyses have examined wage determination with an arti cial restriction that employment is determined either before or after wage determination has occurred. Here, employment determination is made part of the bargaining process....
متن کاملWage bargaining with non-stationary preferences under strike decision
In this paper, we present a non-cooperative wage bargaining model in which preferences of both parties, a union and a firm, are expressed by the sequences of discount rates varying in time. For such a wage bargaining with non-stationary preferences, we determine subgame perfect equilibria between the union and the firm for the case when the union is supposed to go on strike in each period in wh...
متن کاملRegional Wage Differentiation and Wage Bargaining Systems in the European Union
The theoretical literature has argued that a centralized wage bargaining system may result in low regional wage differentiation and high regional unemployment differentials. The empirical literature has found that centralized wage bargaining leads to lower wage inequality for different skills, industries and population groups, but the evidence on its impact on regional wage differentiation is s...
متن کاملUnemployment, Factor Substitution and Capital Formation
We incorporate a wage-bargaining structure in a dynamic general equilibrium model and show how this feature changes shortand long-run properties of equilibria compared with a perfectly competitive setting. We discuss how employment, capital and income shares respond to wage-setting shocks and show that adjustment dynamics depend decisively on the magnitude of the elasticity of substitution betw...
متن کامل