We Want Them All Covered! Collective Bargaining and Firm Heterogeneity: Theory and Evidence from Germany

37 Pages Posted: 11 Aug 2017

See all articles by Florian Baumann

Florian Baumann

University of Bonn

Tobias Brändle

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

Date Written: September 2017

Abstract

This article establishes a link between the degree of productivity dispersion within an industry and collective bargaining coverage of the firms in the industry. In a stylized unionized oligopoly model, we show that differences in productivity levels can affect the design of collective wage contracts a sector‐union offers to heterogeneous firms. Using German linked employer–employee data, we test a range of our theoretical hypotheses and find empirical support for them. The dispersion of sector‐level labour productivity decreases the likelihood of firms being covered by a collective bargaining agreement on the industry level, but increases the likelihood of firms being covered by firm‐level agreements. The results hold for different subsamples and (panel) estimation techniques.

Suggested Citation

Baumann, Florian and Brändle, Tobias, We Want Them All Covered! Collective Bargaining and Firm Heterogeneity: Theory and Evidence from Germany (September 2017). British Journal of Industrial Relations, Vol. 55, Issue 3, pp. 463-499, 2017, Available at SSRN: https://ssrn.com/abstract=3016845 or http://dx.doi.org/10.1111/bjir.12239

Florian Baumann (Contact Author)

University of Bonn ( email )

Regina-Pacis-Weg 3
Postfach 2220
Bonn, D-53012
Germany

Tobias Brändle

University of Tuebingen ( email )

Melanchthonstraße 30
Tuebingen, 72074
Germany

Institute for Applied Economic Research (IAW) ( email )

Ob dem Himmelreich 1
Tubingen, 72074
Germany

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
0
Abstract Views
146
PlumX Metrics