This paper investigates the impact of a collective agreement stipulating a one shot increase in establishment-specific wage levels in a public-sector setting where wages otherwise are set according to individualized wage bargaining. The agreement stipulated that wages should increase in...

We explore the role of firing costs on labor market outcomes in a search and matching framework with distinct decisions on the intensive (hours per employee) and extensive (employment) margins of labor supply. We show that allowing for two distinct labor supply margins matters for assessing...