We study the wage-change distribution in union contracts reached in Canada between 1976-1999. We use non-parametric tests to check for nominal wage rigidity and find that it is present during low inflation periods.

A sample of 11885 wage agreements, reached in the Canadian unionized sector during 1976-2000, a period of high as well as exceptionally low inflation and substantial fluctuations in nominal and real uncertainty, is used to study the determinants of key provisions of contracts such as their...