surplus is more equitable compared to the case with a purely selfish worker. Moreover, the optimal contract with bargaining … approaches the welfare-optimal contract as the parties' bargaining power converges. Our results help explain why workers are … imply that raising the bargaining power of the less powerful party may increase welfare …

importance of individual bargaining in wage determination. We show that simple survey questions accurately elicit firms …' bargaining strategies. Using the elicited strategies for 772 German firms, we document that the majority of firms are willing to … engage in individual wage bargaining. Labor market factors predict firms' strategies better than firm characteristics. Survey …

offers, whereas high productivity firms use Nash bargaining over wages. There are two important sources of inefficiency in … the model besides the well-known classical search externality. First, low-skilled workers do not have any bargaining power …

restrictions imposed by the rather centralized system of collective bargaining in Germany, plants which make use of single …