Opening Clauses in Collective Bargaining Agreements: More Flexibility to Save Jobs?

27 Pages Posted: 21 Mar 2012

See all articles by Tobias Brändle

Tobias Brändle

University of Tuebingen; Institute for Applied Economic Research (IAW)

Wolf Dieter Heinbach

Institute for Applied Economic Research (IAW); Institut für Volkswirtschaftslehre (520B)

Date Written: October 10, 2011

Abstract

This paper analyses the impact of opening clauses in German collective bargaining agreements (CBAs) on job flows. Opening clauses should provide firms with more flexibility in economic crises. Therefore, firms operating under a CBA with opening clauses are expected to have lower job turnover, in particular lower job destruction under bad business conditions, and, as a result, higher job growth. For our empirical analyses we use the IAB Establishment Panel, a large and representative data set on German establishments. We supplement the data with additional information on the existence of opening clauses in CBAs in the West German manufacturing sector (the IAW Data Set on Opening Clauses). By means of a matching approach, we reveal that the existence of opening clauses has a significantly positive effect on job growth due to a negative effect on job destruction and a positive effect on job creation. In contrast, explicit knowledge of opening clauses or their application has no significant effect on job flows.

Keywords: collective bargaining, opening clauses, job flows, propensity score matching

JEL Classification: J51, J63, C21

Suggested Citation

Brändle, Tobias and Heinbach, Wolf Dieter, Opening Clauses in Collective Bargaining Agreements: More Flexibility to Save Jobs? (October 10, 2011). Available at SSRN: https://ssrn.com/abstract=2026473 or http://dx.doi.org/10.2139/ssrn.2026473

Tobias Brändle (Contact Author)

University of Tuebingen ( email )

Melanchthonstraße 30
Tuebingen, 72074
Germany

Institute for Applied Economic Research (IAW) ( email )

Ob dem Himmelreich 1
Tubingen, 72074
Germany

Wolf Dieter Heinbach

Institute for Applied Economic Research (IAW) ( email )

Ob dem Himmelreich 1
Tubingen, 72074
Germany
+497071989627 (Phone)
+497071989699 (Fax)

HOME PAGE: http://www.iaw.edu

Institut für Volkswirtschaftslehre (520B) ( email )

Fruwirthstr. 48
Stuttgart, 70599
Germany
+4971145022932 (Phone)

HOME PAGE: http://www.statistik.uni-hohenheim.de

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