Vinsamlegast notið þetta auðkenni þegar þið vitnið til verksins eða tengið í það: http://hdl.handle.net/1946/17497
It is widely accepted within the field of labor economics that centralization of
collective bargaining leads to lower wage dispersion. But is it possible to change the
wage structure through changes in the collective bargaining agreement and
decentralization of the bargaining process? A unique opportunity to explore this
question presented itself when changes were made to collective bargaining contracts in
the public sector in Iceland.
In the first chapter I look at the Icelandic labor market. The Icelandic labor force is
often described as being flexible. But is it really? Using definitions of labor-market
flexibility, I explore whether the Icelandic labor market can be classified as such and
find that on most measures of flexibility the Icelandic labor market can be described as
In the second chapter I explore the effects of the changes in the bargaining structure
and decentralization in the public sector in Iceland on the wage structure. Did wage
dispersion increase with decentralization, as theory would predict? I find that wage
levels rose significantly, and that the wage structure for total wages did not change but
that the dispersion of daytime wages increased.
In the third and final chapter I develop a model of collective bargaining as a two-stage
process in the manner of Manning (1987). The resulting two-equation nonlinear
structural model is then applied to the central government in Iceland in order to
determine whether the collective bargaining structure changed along with the changes
in the collective bargaining agreements.
The decentralization of bargaining and the change in the collective bargaining
agreements has changed the bargaining structure in the public sector in Iceland. I find
that the unions have a greater bargaining power over employment than over wages,
whereas their bargaining power over wages currently seems to be much greater for
daytime wages than for total wages. Based on the means of the estimates of the
bargaining power of unions over wages and employment, respectively, I can reject the
monopoly union and right-to-manage bargaining models.
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