Market power, dismissal threat and rent sharing
Subtitle: the role of insider and outsider forces in wage bargaining
By: by Anabela Carneiro, Pedro Portugal
Contributors: Portugal, Pedro
Series: Discussion paper -- no. 2102; Discussion paper (Forschungsinstitut zur Zukunft der Arbeit : Online) -- no. 2102
Publisher: IZA
Published: 2006
Place of publication: Bonn, Germany
Language: eng
Format: [electronic resource] :
Subjects: Wage bargaining; Wages
Description: "One of the predictions of the insider-outsider theory is that wages will be higher in sectors (firms) with high labor adjustment costs/high turnover costs. This prediction is tested empirically in this study, using an insider-outsider model and a longitudinal panel of large firms in Portugal. The results revealed that firms where insider workers appear to have more market power tend to pay higher wages. In particular, we found that the threat of dismissal acts to weaken insiders' bargaining power and, consequently, to restrain their wage claims. Moreover, the results also showed that real wages in Portugal are downward rigid"--Forschungsinstitut zur Zukunft der Arbeit web site.
Notes: Title from PDF file as viewed on 4/27/2006.

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