Using a sample of 19 advanced countries from 1990 to 2014 and an Arellano – Bover-Blundell – Bond linear dynamic GMM estimator
along with a bootstrap-based bias correction fixed effects estimator for dynamic panels, the paper examines the macroeconomic
impact of collective bargaining structures in a context of varying intersectoral heterogeneity in productivity growth among
the exposed and sheltered sectors of the economy. Results show a dampening impact of pattern and centralised bargaining structures
on unemployment. However, strong domestic demand is a key precondition for such a favourable effect to materialise. Uncoordinated
and centralised bargaining structures are the most efficient in terms of labour cost restraint while industry bargaining moderates
labour cost growth as intersectoral productivity differentials widen.
Research group:Macroeconomics and European Economic Policy