Wages, profits and rent-sharing
Blanchflower, David G., Oswald, Andrew J. and Sanfey, Peter (1996) Wages, profits and rent-sharing. Quarterly Journal of Economics, Vol.111 (No.1). pp. 227-251. ISSN 0033-5533 Official URL: http://dx.doi.org/10.2307/2946663 AbstractThe paper suggests a new test for rent-sharing in the U.S. labor market. Using an unbalanced
panel from the manufacturing sector, it shows that a rise in a sector's profitability leads after some
years to an increase in the long-run level of wages in that sector. The paper controls for workers'
characteristics, for industry fixed-effects, and for unionism. Lester's range of wages is estimated,
for rent-sharing reasons alone, at approximately 24 per cent of the mean wage. | Item Type: | Journal Article |
|---|
| Subjects: | H Social Sciences > HD Industries. Land use. Labor |
|---|
| Divisions: | Faculty of Social Sciences > Economics |
|---|
| Library of Congress Subject Headings (LCSH): | Labor economics -- United States |
|---|
| Journal or Publication Title: | Quarterly Journal of Economics |
|---|
| Publisher: | MIT Press |
|---|
| ISSN: | 0033-5533 |
|---|
| Date: | February 1996 |
|---|
| Volume: | Vol.111 |
|---|
| Number: | No.1 |
|---|
| Page Range: | pp. 227-251 |
|---|
| Status: | Peer Reviewed |
|---|
| Access rights to Published version: | Open Access |
|---|
| Description: | Pre-print (also known as author final version). |
|---|
| Related URLs: | |
|---|
| References: | Abowd, John M., "The Effect of Wage Bargains on the Stock Market Value of the Firm",
American Economic Review, LXXXIX (1989), 774-800.
Abowd, John M., "Appendix: The NBER Trade and Labor Market Databases", in Abowd, John
M., and Richard Freeman (Eds.), Immigration, Trade and Labor Markets (Chicago:
University of Chicago Press and National Bureau of Economic Research, 1991).
Abowd, John M., and Thomas Lemieux, "The Effects of Product Market Competition on
Collective Bargaining Agreements: The Case of Foreign Competition in Canada", Quarterly
Journal of Economics, CVIII (1993), 983-1014.
Allen, Steven G., "Updated Notes on the Interindustry Wage Structure", mimeo, North
Carolina State University, 1993.
Azariadis, Costas, "Implicit Contracts and Underemployment Equilibria", Journal of
Political Economy, LXXXIII (1975), 1183-1202.
Baily, Martin N., "Wages and Employment Under Uncertain Demand", Review of Economic
Studies, XLI (1974), 37-50.
Bazerman, Max H., "Norms of Distributive Justice in Interest Arbitration", Industrial and Labor
Relations Review, XXXVIII (1985), 558-570.
Beckerman, Wilfred, and Timothy J. Jenkinson, "Wage Bargaining and Profitability: A
Disaggregative Analysis", Labor, IV (1990), 57-77.
Blanchflower, David G., and Andrew J. Oswald, "Internal and External Influences Upon Wage
Settlements", British Journal of Industrial Relations, XXVI (1988), 363-370.
Blanchflower, David G., and Andrew J. Oswald, "The Wage Curve", Scandinavian Journal of
Economics, XCII (1990), 215-235.
Blanchflower, David G., Andrew J. Oswald, and Mario D. Garrett, "Insider Power in Wage
Determination", Economica, LVII (1990), 363-370.
Blanchflower, David G., and Andrew J. Oswald, The Wage Curve (Cambridge, MA: MIT Press,
1994).
Carruth, Alan A., and Andrew J. Oswald, "Wage Inflexibility in Britain", Oxford Bulletin of
Economics and Statistics, IL (1987), 59-78.
Carruth, Alan A., and Andrew J. Oswald, Pay Determination and Industrial Prosperity (Oxford,
UK: Oxford University Press, 1989).
Christofides, Louis N., and Andrew J. Oswald, "Real Wage Determination and Rent-
Sharing in Collective Bargaining Agreements", Quarterly Journal of Economics, CVII
(1992), 985-1002.
Denny, Kevin, and Stephen Machin, "The Role of Profitability and Industrial Wages in Firm-
Level Wage Determination", Fiscal Studies, XII (1991), 34-45.
10
Dickens, William T., "Error Components in Grouped Data: Is It Ever Worth Weighting?", Review
of Economics and Statistics, LXXII (1990), 328-333.
Dickens, William T., and Lawrence F. Katz, "Inter-Industry Wage Differences and Industry
Characteristics", in Lang, Kevin, and Jonathan Leonard, Unemployment and the Structure of
Labor Markets (Oxford, UK: Basil Blackwell, 1987).
Gray, Wayne, "Industry Productivity Database", mimeo, Clark University, 1989.
Greene, William H., Econometric Analysis (New York: Macmillan, 1990).
Groshen, Erica L., "Sources of Intra-Industry Wage Dispersion: How Much Do Employers
Matter?", Quarterly Journal of Economics, CVI (1991), 869-884.
Hamermesh, Daniel S., "Wage Bargains, Threshold Effects and the Phillips Curve", Quarterly
Journal of Economics, LXXXV (1970), 501-517.
Hildreth, Andrew K. G., and Andrew J. Oswald, "Rent-Sharing and Wages: Evidence from
Company and Establishment Panels", mimeo, Oxford University, 1992.
Holmlund, Bertil, and Johnny Zetterberg, "Insider Effects in Wage Determination: Evidence from
Five Countries", European Economic Review, XXXV (1991), 1009-1034.
Hsiao, Cheng, Analysis of Panel Data (Cambridge, UK: Cambridge University Press, 1990).
Katz, Lawrence F., and Lawrence H. Summers, "Industry Rents: Evidence and Implications",
Brookings Papers on Economic Activity (Microeconomics), 1989, 209-275.
Katz, Lawrence F., and Kevin M. Murphy, "Changes in Relative Wages, 1963-1987: Supply and
Demand Factors", Quarterly Journal of Economics, CVII (1992), 35-78.
Krueger, Alan B., and Lawrence H. Summers, "Reflections on the Inter-Industry Wage
Structure", in Lang, Kevin, and Jonathan Leonard,Unemployment and the Structure of
Labor Markets (Oxford, UK: Basil Blackwell, 1987).
Krueger, Alan B., and Lawrence H.Summers, "Efficiency Wages and the Inter-Industry Wage
Structure", Econometrica, LVI (1988), 259-293.
Lester, Richard A., "A Range Theory of Wage Differentials", Industrial and Labor Relations
Review, V (1952), 483-500.
Macleod, W.Bentley, and James M. Malcomson, "Investments, Holdup, and the Form of Market
Contracts", American Economic Review, LXXXIII (1993), 811-837.
Moulton, Brent R., "Random Group Effects and the Precision of Regression Estimates", Journal
of Econometrics, XXXII (1986), 385-397.
Nickell, Stephen J., "Biases in Dynamic Models with Fixed Effects", Econometrica, IL (1981),
1417-1426.
Nickell, Stephen J., and Sushil Wadhwani, "Insider Forces and Wage Determination",
Economic Journal, C (1990), 496-509.
Oswald, Andrew J., "Unemployment Insurance and Labor Contracts Under Asymmetric
Information: Theory and Facts", American Economic Review, LXXVI (1986), 365-377.
Oswald, Andrew J., "Rent-Sharing in the Labor Market", mimeo, London School of Economics,
1995.
Reder, Melvin W., "Wage Differentials: Theory and Measurement", originally published in 1962,
in National Bureau of Economic Research, Aspects of Labor Economics, Princeton:
Princeton University Press, reprinted in King, J.E., Readings in Labor Economics
(Oxford, UK: Oxford Univesity Press, 1980).
Sanfey, Peter, "Insiders and Outsiders in Union Models: Theory and Evidence for the US and the
UK", unpublished Ph.D. dissertation, Yale University, 1992.
Sanfey, Peter, "Wages and Insider-Outsider Models: Theory and Evidence for the US", mimeo,
University of Kent, 1993.
Slichter, Sumner, "Notes on the Structure of Wages", Review of Economics and Statistics, XXXII
(1950), 80-91.
Sparks, Gordon R., and David A. Wilton, "Determinants of Negotiated Increases: An
Empirical Wage Analysis", Econometrica, XXXIX (1971), 739-750. |
|---|
Request changes to a record Repository Staff Only: item control page |
![[img]](http://wrap.warwick.ac.uk/style/images/fileicons/application_pdf.png)
