We analyze union behavior in a model with membership dynamics and compare the labor market outcomes to static union models. Based on empirical findings we modify standard models and show that the well-known result that static models overstate distortions caused by unions only holds in the...

Ogawa et al. (2006) analyze capital tax competition in a fixed-wage approach and show that the original results of Zodrow and Mieszkowski (1986) are not preserved in the presence of unemployment. In the present paper we challenge this view and investigate capital tax competition for some...

It is analyzed the impacts of outsourcing cost and wage tax progression under labor market imperfections with Nash wage bargaining and flexible outsourcing. With sufficiently strong (weak) labor market imperfection, lower outsourcing cost has a wage-moderating (wage-increasing) effect so that...

Common wisdom holds that the introduction of a non-binding minimum wage is irrelevant for actual wages and employment. Empirical and experimental research, however, has shown that the introduction of a minimum wage can raise even those wages that were already above the new minimum wage. In this...

This paper analysis the link between political strength and public sector wages using a unique matched individual-employer data set for Norwegian local governments during the period 1990-1998. The results indicate that political strength, measured in several ways, has a positive effect on wages,...

This paper provides a model that can account for the almost uniform staggering of wage contracts in some countries as well as for the markedly nonuniform staggering in others. In the model, short and long contracts as well as long contracts concluded in different periods are strategic...

In oligopolistic industries, increased cost saving opportunities via offshoring have a moderating effect on trade unions. In order to discourage mobile firms from leaving the country, unions accept lower sector wages. In effect, the negotiated wage becomes independent of workers' bargaining...

We study the spillover effects of minimum wages in a laboratory experiment. In a bilateral firm-worker bargaining setting, we find that the introduction of a minimum wage exerts upward pressure on wages even if the minimum wage is too low to be a binding restriction. Furthermore, raising the...

Many countries suffer from persistently high unemployment rates. The scope for labour market reforms is often limited to measures that hurt neither shareholders nor workers. This paper develops a policy proposal, which allows the government to reduce wage costs without changing the income...