THE IMPORTANCE OF NATIONAL WAGE AGREEMENTS*

It is a commonplace of the literature on labour economics and industrial relations that the post-war period has seen the emergence of a substantial gap between minimum or standard wage rates agreed in official industry-wide negotiations and actual earnings in the workplace throughout many leading sectors of the economy.     

PRODUCT AND LABOUR MARKETS IN WAGE DETERMINATION: SOME AUSTRALIAN EVIDENCE

The study is concerned with the extent to which workplace wage drift is influenced by establishment-specific or occupation-specific factors. It demonstrates, by analysis of variance of pay data from a survey of 44 occupations in 198 workplaces, that the sources of variation are predominantly establishment-specific. There is evidence of a link between the amount of discretion an employer exercises in the labour market and the degree of concentration in his product market. It is argued that discussions of pay determination have been unduly preoccupied with labour market processes and have neglected the variation in employer behaviour arising from differences in product market.     

COLLUSION IN THE PRESENCE OF EXTERNALITIES*

I examine collusive bidder behavior in auctions with negative externalities and show that the optimal bidding scheme exhibits only partial rigidity. Because of externalities, a cartel not only has incentive to maximize gains from trade but also to minimize the probability of sales. I identify the tension between the two incentives and show that the more rigid the bidding scheme, the higher the possibility of sales. As the extent of externalities increases, the cartel finds it more important to keep a low probability of sales than to minimize payment to the seller. This results in a partially‐rigid optimal collusive bidding scheme.