This study provides empirical evidence for the economic rationality of wage rigidities. Theoretically wage rigidities can result from contracts, implicit contracts, from efficiency wages and from insider-outsider behaviour. Based on a survey of 801 firms strong support has been found for...

This study provides empirical evidence for the economic rationality of wage rigidities. Theoretically wage rigidities can result from contracts, implicit contracts, from efficiency wages and from insider-outsider behaviour. Based on a survey of 801 firms strong support has been found for...

This paper examines critically the system of industry-level wage bargaining in Germany. More specifically, it shows that the importance of industry-level wage bargaining declines in Germany and that one major reason for this development is the highly restrictive institutional framework. However,...