The Impact of Wage Bargaining Regime on Firm‐Level Competitiveness and Wage Inequality: The Case of Ireland |
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| Authors: | SEAMUS McGUINNESS ELISH KELLY PHILIP J O’CONNELL |
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| Institution: | The authors’ affiliations are, respectively, The Economic and Social Research Institute, Whitaker Square, Sir John Rogerson’s Quay, Dublin 2, Ireland. E‐mail: . We are grateful to the Central Statistics Office (CSO) for access to the data used in this study. |
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| Abstract: | This paper uses a linked employer‐employee dataset to analyze the impact of institutional wage bargaining regimes on average labor costs and within‐firm wage dispersion in private sector companies in Ireland. The results show that while centralized bargaining reduced labor costs within both the indigenous and foreign‐owned sectors, the relative advantage was greater among foreign‐owned firms. The analysis suggests that there are potentially large competitiveness gains to multinational companies that locate in countries implementing a centralized bargaining system. Furthermore, the results provide additional support to the view that collective bargaining reduces within‐firm wage inequality. |
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| Keywords: | J51 J52 J58 |
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