This paper examines the determinants of short-term wage dynamics, using asample of large Hungarian companies for the period of 1996-1999. We test thebasic implications of an efficient contract model of bargaining between theincumbent employees and the managers, which we are unable to reject....

This paper studies the impact of labour taxation in a shirking model with wage bargaining.It is shown that if the ratio of unemployment compensation to the net-of-tax wage iskept fixed a tax cut leads to higher unemployment. When the unemployment benefitsreplacement ratio is allowed to change,...