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Decentralized Wage Formation in Sweden

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  • Lena Granqvist
  • Håkan Regnér

Abstract

Recent Swedish collective bargaining agreements have incorporated provisions for local pay review talks and opportunities for individuals to negotiate their own wages. Using trade union data, we show that members who participate in local pay review talks and members who negotiate their own wages have significantly higher monthly wages than those who do not. Pay decentralization either improves an individual's bargaining position or attracts more productive trade union members. Either way, trade union wage policies to increase individual‐level wage variance are achieving their intended effects.

Suggested Citation

  • Lena Granqvist & Håkan Regnér, 2008. "Decentralized Wage Formation in Sweden," British Journal of Industrial Relations, London School of Economics, vol. 46(3), pages 500-520, September.
    • Handle: RePEc:bla:brjirl:v:46:y:2008:i:3:p:500-520
    DOI: 10.1111/j.1467-8543.2008.00688.x
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    Cited by:

    1. Andréasson, Hannes, 2014. "The effect of decentralized wage bargaining on the structure of wages and firm performance," Ratio Working Papers 241, The Ratio Institute.
    2. Bernd Brandl & Christian Lyhne Ibsen, 2017. "Instability and Change in Collective Bargaining: An Analysis of the Effects of Changing Institutional Structures," British Journal of Industrial Relations, London School of Economics, vol. 55(3), pages 527-550, September.
    3. Willén, Alexander, 2021. "Decentralization of wage determination: Evidence from a national teacher reform," Journal of Public Economics, Elsevier, vol. 198(C).
    4. Braakmann, Nils & Brandl, Bernd, 2016. "The Efficacy of Hybrid Collective Bargaining Systems: An Analysis of the Impact of Collective Bargaining on Company Performance in Europe," MPRA Paper 70025, University Library of Munich, Germany.
    5. Brändle, Tobias, 2024. "Unions and Collective Bargaining: The Influence on Wages, Employment and Firm Survival," GLO Discussion Paper Series 1457, Global Labor Organization (GLO).
    6. Andrea Garnero & François Rycx & Isabelle Terraz, 2020. "Productivity and Wage Effects of Firm‐Level Collective Agreements: Evidence from Belgian Linked Panel Data," British Journal of Industrial Relations, London School of Economics, vol. 58(4), pages 936-972, December.
    7. Marta Lachowska, 2017. "Outside options and wages: What can we learn from subjective assessments?," Empirical Economics, Springer, vol. 52(1), pages 79-121, February.
    8. Roland Ahlstrand & Jérôme Gautié, 2023. "Labour–management relations and employee involvement in lean production systems in different national contexts: A comparison of French and Swedish aerospace companies," Economic and Industrial Democracy, Department of Economic History, Uppsala University, Sweden, vol. 44(4), pages 1027-1051, November.
    9. Karlson, Nils & Lindberg, Henrik, 2011. "The Decentralization of Wage Bargaining: Four Cases," Ratio Working Papers 178, The Ratio Institute.
    10. Säve-Söderbergh, Jenny, 2019. "Gender gaps in salary negotiations: Salary requests and starting salaries in the field," Journal of Economic Behavior & Organization, Elsevier, vol. 161(C), pages 35-51.
    11. Bustos, Emil, 2024. "Collectively Bargained Wages and Female Earnings: Evidence from Swedish Local Governments," Working Paper Series 1494, Research Institute of Industrial Economics.
    12. Ylva Ulfsdotter Eriksson & Bengt Larsson & Petra Adolfsson, 2021. "Under the Surface of Individual and Differentiated Pay in Sweden: A Zero‐Sum Game of Performance‐Based Pay?," British Journal of Industrial Relations, London School of Economics, vol. 59(2), pages 398-417, June.
    13. Antti Kauhanen & Terhi Maczulskij & Krista Riukula, 2024. "The incidence and effects of decentralized wage bargaining in Finland," Journal of Labor Research, Springer, vol. 45(2), pages 232-253, June.
    14. Nils BRAAKMANN & Bernd BRANDL, 2021. "The performance effects of collective and individual bargaining: A comprehensive and granular analysis of the effects of different bargaining systems on company productivity," International Labour Review, International Labour Organization, vol. 160(1), pages 43-64, March.

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