We analyze the welfare and employment effects of different wage bargaining regimes. Within the large firm search model, we show that collective bargaining affects employment via two channels. Collective bargaining exerts opposing effects on job creation and wage setting. Firms have a stronger...

This paper analyzes the cyclicality of real consumer wages and real producer wages in Germany. In order to scrutinize whether the empirical results are robust to the detrending method, we apply the deterministic trend model, the Beveridge-Nelson decomposition, the Hodrick-Prescott filter, the...

This study analyzes employers' support for the introduction of minimum wages in order to improve their competitive position. Using a unique data set consisting of 800 firms in eight industries in the German service sector, we find some evidence that high-productivity employers support minimum...

We use a representative sample of German establishments to show that those with foreign ownership are more likely to use performance appraisal, profit sharing and employee share ownership than are those with domestic ownership. Moreover, we show that works councils are associated with an...

This paper provides evidence on the labor market adjustments following a large import shock on both the individual and the firm level. We exploit a quasi-experimental shock in the German clothing industry caused by the phasing out of the Multi-Fibre Arrangement. Using the German shoe industry as...

In recent decades, many firms offered more discretion to their employees, often increasing the productivity of effort but also leaving more opportunities for shirking. These "high-performance work systems" are difficult to understand in terms of standard moral hazard models. We show...

This study analyzes state dependence in low-wage employment of western German women using GSOEP data, 2000-2006. We estimate dynamic multinomial logit models with random effects and find that having a low-wage job increases the probability of being low-paid and decreases the chances of being...

Using a representative establishment dataset, this paper analyzes the incidence of wage posting and wage bargaining in the matching process. We show that both modes of wage determination coexist in the German labor market, with about two-thirds of hirings being characterized by wage posting....