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Article

Insider power in wage determination

Citation
Blanchflower D, Oswald AJ & Garrett MD (1990) Insider power in wage determination. Economica, 57 (226), pp. 143-170. https://doi.org/10.2307/2554158

Abstract
The paper argues that wage determination is best seen as a kind of rent-sharing in which workers' bargaining power is influenced by conditions in the external labour market. It uses British establishment data from 1984 to show that pay depends upon a blend of insider pressure (including the employer's financial performance and oligopolistic position) and outsider pressure (including external wages and unemployment). Lester's feasible "range" of wages appears typically to be between 8 and 22% of pay. Estimates of the unemployment elasticity of the wage lie in a narrow band around -0.1.

Keywords
bargaining power; insider power; labour market; wage determination; workers

Journal
Economica: Volume 57, Issue 226

StatusPublished
Author(s)Blanchflower, David; Oswald, Andrew J; Garrett, Mario D
Publication date31/05/1990
URLhttp://hdl.handle.net/1893/10234
PublisherWiley-Blackwell for the London School of Economics and Political Science
ISSN0013-0427
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