Institutional Features of Wage Bargaining in 23 European Countries, the US and Japan

National Bank of Belgium Working Paper No. 154

56 Pages Posted: 30 Sep 2010

See all articles by Philip Du Caju

Philip Du Caju

National Bank of Belgium

Erwan Gautier

Banque de France - Centre de Recherche

Daphne Momferatou

European Central Bank (ECB)

Melanie E. Ward-Warmedinger

European Central Bank (ECB); Centre for Economic Policy Research (CEPR); IZA Institute of Labor Economics

Multiple version iconThere are 4 versions of this paper

Date Written: December 9, 2008

Abstract

This paper presents information on wage-bargaining institutions, collected for 23 European countries, plus the US and Japan using a standardised questionnaire. Our data provide information from the years 1995 and 2006, for four sectors of activity and the aggregate economy. The main findings include a high degree of regulation in wage-setting in most countries. Although union membership is limited in many of them, union coverage is high and almost all countries also have some form of national minimum wage. Most countries negotiate wages on several levels, the sectoral level still being the most dominant, with an increasingly important role for bargaining at the individual firm level. The average length of collective bargaining agreements is found to lie between one and three years. Most agreements are strongly driven by developments in prices and eleven of the countries surveyed have some form of indexation mechanism which affects wages. Cluster analysis identifies three country groupings of wage-setting institutions.

Keywords: wage bargaining, institutions, indexation, coverage, trade union membership, contract length

JEL Classification: J31, J38, J51, J58

Suggested Citation

Du Caju, Philip and Gautier, Erwan and Momferatou, Daphne and Ward-Warmedinger, Melanie E., Institutional Features of Wage Bargaining in 23 European Countries, the US and Japan (December 9, 2008). National Bank of Belgium Working Paper No. 154. Available at SSRN: https://ssrn.com/abstract=1684454 or http://dx.doi.org/10.2139/ssrn.1684454

Philip Du Caju (Contact Author)

National Bank of Belgium ( email )

Research Department
Boulevard de Berlaimont 14
B-1000 Brussels, 1000
Belgium

Erwan Gautier

Banque de France - Centre de Recherche ( email )

31 rue Croix des Petits Champs
75049 Paris Cedex 01
France

Daphne Momferatou

European Central Bank (ECB) ( email )

Sonnemannstrasse 22
Frankfurt am Main, 60314
Germany

Melanie E. Ward-Warmedinger

European Central Bank (ECB) ( email )

Sonnemannstrasse 22
Frankfurt am Main, 60314
Germany

Centre for Economic Policy Research (CEPR)

London
United Kingdom

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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