We analyze the following questions under imperfect labour markets. How does strategic outsourcing influence wage formation, profit sharing and employee effort when firms commit to optimal profit sharing before wage formation or decide for profit sharing after wage formation? What is the relationship between outsourcing, profit sharing, and equilibrium unemployment? We find that in both scenario...

Wage Gaps Large and Small The law of one wage does not strictly hold, nor should it be expected to hold, in contemporary labor markets. The law of one wage, however, provides a surprisingly good first approximation of the structure of U.S. wages. This generalization is drawn from research on a diverse set of topics: the Mincerian wage equation and earnings imputation, union wage differentials, ...

This paper analyses wage dynamics at individual level using the European Community Household Panel data. We compare yearly wage changes of full-time employees staying in the same ...rm for twelve European countries during the 1994-96 time-period. For all the European countries we ...nd evidence of nominal wage rigidity. The percentage of employees receiving no wage changes is di¤erent across co...

Two-digit manufacturing industry-level production functions are used to test efficiency wage propositions. Conclusive tests require functional forms which allow differences in elasticities of substitution between observable human capital, wage premia and other inputs. Results demonstrate that unexplained industry wage premia and higher unemployment rates raise productivity. Wage premia and the ...

The present paper examines a two-country model, one with flexible wage and prices (which seems to characterize most high performance East Asian economies), and the other with sticky wage and prices. Wage and prices often “over-shoot” in the flexible wage economy. The impacts of fixed and floating exchange rage regime on the flexible wage economy is typically different. A fixed (floating) exchan...

The mid-1970's marked a turning point in Italy's industrial relations system . At that time, the system appeared to be a case of pluralism, recognized and supported by the statute of workers' rights (Act 300/1970). The main aspects and institutions of industrial relations remained outside the legal regulation . In fact, trade unions and employers' associations exercised joint power. Trade union...

Local minimum wage laws are becoming common across U.S. cities, and their effects may be different from the effects of state or nationwide minimum wage policies. This paper studies the effect of changes in the minimum wage on spatial equilibriums in local labor markets. Using residence and workplace data for the United States, I analyze how commuting, residence, and employment locations change ...

this study examins effects of trade liberalization on the wage inequality between urban and rural labor by utilizing the data of micro-level households’ income and expenditures surveys and trade statistics over 2001-2011. the analysis is carried based on the heckscher–ohlin’s theory in international trade and baker’s taste discrimination theory at firms. we use quantile regression and ordinary ...