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Collective Wage Agreements and Firms’ Employment Policies
Author(s) -
Kaiser Ulrich,
Pfeiffer Friedhelm
Publication year - 2001
Publication title -
labour
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.403
H-Index - 34
eISSN - 1467-9914
pISSN - 1121-7081
DOI - 10.1111/1467-9914.00167
Subject(s) - wage , labour economics , service (business) , economics , production (economics) , tertiary sector of the economy , business , collective bargaining , economy , microeconomics
This paper provides evidence on the way collective wage agreements affect the adjustment of employment, working hours and other production factors when service‐sector firms are faced with demand shocks. The estimation results indicate that collective wage agreements significantly influence firms’ employment policies. It is shown that recruitment is a widespread instrument for service firms to cope with demand fluctuations which are negatively affected by collective wage agreements. The employment of freelance workers is also negatively affected by collective wage agreements, while their effect on using short‐term employment contracts as a reaction to demand shocks is positive.