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Does pattern bargaining explain wage restraint in the German public sector?

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  • Di Carlo, Donato
Abstract
German public sector wage restraint has been explained through the presence of a specific type of inter-sectoral wage coordination in the industrial relations system - i.e., export sector-led pattern bargaining. This paper has a twofold ambition. First, as a literature-assessing exercise, I review the literature in industrial relations and comparative political economy (CPE) and find that (1) the origins and mechanics of inter-sectoral wage coordination through pattern bargaining have never been laid out clearly; (2) the mechanisms of the pattern bargaining thesis have never been tested empirically; and (3) the CPE literature reveals a limiting export-sector bias. Second, as a theory-testing exercise, I perform hoop tests to verify whether the pattern bargaining hypothesis can really account for wage restraint in the German public sector. I find that Germany cannot be considered a case of export sector-driven pattern bargaining. These findings challenge core tenets of a longstanding scholarship in both CPE and industrial relations. Most importantly, they open a new research agenda for the study of public sector wage-setting that should shift its focus to public sector employment relations, public finance, public administrations, and the politics of fiscal policy.

Suggested Citation

  • Di Carlo, Donato, 2018. "Does pattern bargaining explain wage restraint in the German public sector?," MPIfG Discussion Paper 18/3, Max Planck Institute for the Study of Societies.
    • Handle: RePEc:zbw:mpifgd:183
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    References listed on IDEAS

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    Cited by:

    1. Scharpf, Fritz W., 2018. "There is an alternative: A two-tier European currency community," MPIfG Discussion Paper 18/7, Max Planck Institute for the Study of Societies.
    2. Bengtsson, Erik, 2019. "The Origins of the Swedish Wage Bargaining Model," Lund Papers in Economic History 195, Lund University, Department of Economic History.
    3. Braun, Benjamin & Deeg, Richard, 2019. "Strong firms, weak banks: The financial consequences of Germany's export-led growth model," MPIfG Discussion Paper 19/5, Max Planck Institute for the Study of Societies.

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