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The Regional Dimension of Collective Wage Bargaining: The Case of Belgium

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  • Michael Rusinek
  • Ilan Tojerow

Abstract

Rusinek M. and Tojerow I. The regional dimension of collective wage bargaining: the case of Belgium, Regional Studies . The potential failure of national industry agreements to take into account productivity levels in the least productive regions has been considered as one of the causes of regional unemployment in European countries. This paper investigates the role of the collective bargaining structure in the relationship between regional wage and productivity differentials. Using a rich Belgian-linked employer-employee dataset, it is found that the more an industry is decentralized in terms of wage setting, the more regional differences in productivity are reflected in wages. It is concluded that the current Belgian wage-setting system already includes mechanisms that allow regional productivity to be taken into account.

Suggested Citation

  • Michael Rusinek & Ilan Tojerow, 2014. "The Regional Dimension of Collective Wage Bargaining: The Case of Belgium," Regional Studies, Taylor & Francis Journals, vol. 48(2), pages 301-317, February.
    • Handle: RePEc:taf:regstd:v:48:y:2014:i:2:p:301-317
    DOI: 10.1080/00343404.2011.632625
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    1. Uwe Blien & Wolfgang Dauth & Thorsten Schank & Claus Schnabel, 2013. "The Institutional Context of an ‘Empirical Law’: The Wage Curve under Different Regimes of Collective Bargaining," British Journal of Industrial Relations, London School of Economics, vol. 51(1), pages 59-79, March.
    2. Mr. Athanasios Vamvakidis, 2008. "Regional Wage Differentiation and Wage Bargaining Systems in the EU," IMF Working Papers 2008/043, International Monetary Fund.
    3. Lucio R. Pench & Paolo Sestito & Elisabetta Frontini, 1999. "Some unpleasant arithmetics of regional unemployment in the EU. Are there any lessons for EMU?," European Economy - Economic Papers 2008 - 2015 134, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
    4. Romano Piras, 2012. "Internal Migration Across Italian Regions: Macroeconomic Determinants And Accommodating Potential For A Dualistic Economy," Manchester School, University of Manchester, vol. 80(4), pages 499-524, July.
    5. S. Davies & M. Hallet, 2001. "Policy responses to regional unemployment:Lessons from Germany, Spain and Italy," European Economy - Economic Papers 2008 - 2015 161, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
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    Cited by:

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    2. Jozef Konings & Luca Marcolin, 2014. "Do wages reflect labor productivity? The case of Belgian regions," IZA Journal of European Labor Studies, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 3(1), pages 1-21, December.
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    6. Rycx, François & Saks, Yves & Tojerow, Ilan, 2016. "Misalignment of Productivity and Wages across Regions? Evidence from Belgian Matched Panel Data," IZA Discussion Papers 10336, Institute of Labor Economics (IZA).

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    More about this item

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts

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