An emerging literature on the role of unions in international firms mitigates the general perception that exporting firms pay higher wages. In theory, fiercer competition due to the internationalization of a firm negatively feeds back into the unions' rent extraction ability. We propose an empirical test of that prediction using German linked employer-employee data, where the information about plant- and industry-level collective agreements enable us to partition plants into different bargaining regimes. To test the rent-sharing argument we exploit the individual worker information of our data and construct profitability measures that are free of the plant's skill-composition. Our results indicate that rent-sharingin exporting plants is lower if wages are bargained collectively at theplant level. In line with the theoretical prediction we show that a surge in those plants' export intensity is negatively associated with wages.


Hans-Jörg Schmerer

IAB Nürnberg

Working Paper (PDF file, 380 KB)


01.12.2011 | 16:00-17:30


ZEW, L 7,1 D-68161 Mannheim