Preferences for rigid versus individualized wage setting in search economies with frictions
By: by Tito Boeri, Michael C. Burda.
Contributors: Burda, Michael C.
Series: Discussion paper ;; no. 1133; Discussion paper (Forschungsinstitut zur Zukunft der Arbeit : Online) ;; no. 1133
Publisher: IZA
Published: 2004
Place of publication: Bonn, Germany
Language: eng
Format: Electronic resource
Description: "Firing frictions and renegotiation costs affect worker and firm preferences for rigid wages versus individualized Nash bargaining in a standard model of equilibrium unemployment, in which workers vary by observable skill. Rigid wages permit savings on renegotiation costs and prevent workers from exploiting the firing friction. For standard calibrations, the model can account for political support for wage rigidity by both workers and firms, especially in labor markets for intermediate skills. The firing friction is necessary for this effect, and reinforces the impact of both turbulence and other labor market institutions on preferences for rigid wages"--Forschungsinstitut zur Zukunft der Arbeit web site.
Notes: Also available in print.
Includes bibliographical references.
Title from PDF file as viewed on 5/18/2005.
System requirements: Adobe Acrobat Reader.
Mode of access: World Wide Web.