12 1 Introduction 13 2 Cointegration and error correction 17 2.1 An attractor 17 2.2 Cointegrating relations and error correction equations 19 3 Unions and wage bargaining 20 3.1 Union objectives 21 3.2 The bargaining procedure 22 3.3 Local wage setting 24 3.4 Centralized vs. decentralized...