Wage Bargaining and Social Norms

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Abstract
Standard economic theories of wage bargaining emphasize self-interest and bargaining power as the determinants of the wage agreement. The author argues that social norms also shape wage negotiations in a number of ways. After a description of the Swedish system of collective wage bargaining, he discusses the role of social norms in bargaining between unions and employers and in the negotiations that take place among unions when they try to coordinate their claims vis-à-vis the employers. The article concludes with a discussion of the relation between self-interest and norms in the bargaining process

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