In most European countries, money wages are given in collective agreements or individual employment contracts, and the employer cannot unilaterally cut wages, even after the expiration of a collective agreement. Ceteris paribus, workers have a stronger bargaining position when they try to...

In an economy with large wage setters (like industry unions), the monetary regime affects the trade-off between consumer real wages and employment and profits faced by the wage setters. This paper shows that an exchange rate target, including participation in a monetary union, is likely to...

This paper presents and describes a new database of major minimum wage and collective bargaining reforms covering 26 advanced economies over the period 1970-2020. The main advantage of this dataset is the precise identification of the nature and date of major reforms, which is valuable in many...

We show the effects of the bargaining power of labour unions on product innovation under decentralised and centralised wage bargaining. In this context, we show the implications of preference function, which affects the market size. A higher union bargaining power increases innovation if...

Unions are often stigmatized as being a source of inefficiency due to higher collective bargaining outcomes. This is in stark contrast with the descriptive evidence presented in this paper. Larger firms choose to export and are also more likely to adopt collective bargaining. We rationalize...

This paper analyzes unemployment insurance (UI) schemes in the presence of mobile workers and trade unions at industry or regional level that are capable of internalizing the effect of wage demands on UI contribution rates. We compare two types of existing UI systems. When UI is organized at...

Using cross-country data, this paper investigates the relationship between workplace representation and strikes. Works councils are associated with reduced strike activity. However, where union members make up a majority of works councillors, such union-dominated councils experience greater...

This paper extends the Diamond (1980) model with labor unions to study optimal income taxation and to analyze whether unions can be desirable for income redistribution. Unions bargain with firms over wages in each sector and firms unilaterally determine employment. Unions raise the efficiency...

This paper investigates the influence of industrial relations on firm wage premia in Germany. OLS regressions for the firm effects from a two-way fixed effects decomposition of workers' wages by Card, Heining, and Kline (2013) document that average premia are larger in firms bound by collective...

We theoretically analyse the effects of sick pay and employees' health on collective bargaining, assuming that individuals determine absence optimally. If sick pay is set by the government and not paid for by firms, it induces the trade union to lower wages. This mitigates the positive impact on...