Publication
Title
Efficiency wages, unemployment benefits and union : firm wage bargaining : the issue of the choice of the outside option
Author
Abstract
This paper points out that theremay be a logical consistency issue in choosing the reference wage in efficiency wage models.We have shown that defining the outside option in the efficiencywage logic as themarket-clearing wage solves this difficulty, and is justifiable in terms of the assumed behaviour of workers and employers. The model that we examine confirms earlier findings of reinforcing effects between union-firm bargaining and efficiency wages. However, if union preferences vary between wages and employment, Summers reinforcing effect is no longer present for each value of the parameter describing these preferences. Above a certain threshold value of union preferences for employment, the two mechanisms do not reinforce each other anymore.
Language
English
Source (journal)
Journal of labor research. - Fairfax, Va, 1980, currens
Publication
Fairfax, Va : 2011
ISSN
0195-3613 [print]
1936-4768 [online]
Volume/pages
32:1(2011), p. 75-86
ISI
000287860400005
Full text (Publishers DOI)
UAntwerpen
Faculty/Department
Research group
Publication type
Subject
Affiliation
Publications with a UAntwerp address
External links
Web of Science
Record
Identification
Creation 23.03.2011
Last edited 09.04.2017
To cite this reference