Explicit versus Implicit Profit Sharing and the Determination of Wages: Microeconomic Evidence from the UK.

This paper considers the claim that explicit profit sharing reduces the marginal cost of labor. This is contrasted with the view that implicit profit sharing occurs through wage bargaining. Using a macroeconomic data set from the UK we find no evidence that the introduction of profit sharing reduces...

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Opis bibliograficzny
Główni autorzy: Bhargava, S, Jenkinson, T
Format: Journal article
Język:English
Wydane: 1995
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author Bhargava, S
Jenkinson, T
author_facet Bhargava, S
Jenkinson, T
author_sort Bhargava, S
collection OXFORD
description This paper considers the claim that explicit profit sharing reduces the marginal cost of labor. This is contrasted with the view that implicit profit sharing occurs through wage bargaining. Using a macroeconomic data set from the UK we find no evidence that the introduction of profit sharing reduces base wages and, hence, the marginal cost of labor. However, firm profitability is found to have a positive effect on wages, which supports the hypothesis of implicit profit sharing through wage bargaining. These findings suggest that it is hard to justify the favorable tax treatment of profit-related pay found in the UK.
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spelling oxford-uuid:654e5ca2-e11f-44cb-b555-bf7fa5a02ee32022-03-26T18:24:40ZExplicit versus Implicit Profit Sharing and the Determination of Wages: Microeconomic Evidence from the UK.Journal articlehttp://purl.org/coar/resource_type/c_dcae04bcuuid:654e5ca2-e11f-44cb-b555-bf7fa5a02ee3EnglishDepartment of Economics - ePrints1995Bhargava, SJenkinson, TThis paper considers the claim that explicit profit sharing reduces the marginal cost of labor. This is contrasted with the view that implicit profit sharing occurs through wage bargaining. Using a macroeconomic data set from the UK we find no evidence that the introduction of profit sharing reduces base wages and, hence, the marginal cost of labor. However, firm profitability is found to have a positive effect on wages, which supports the hypothesis of implicit profit sharing through wage bargaining. These findings suggest that it is hard to justify the favorable tax treatment of profit-related pay found in the UK.
spellingShingle Bhargava, S
Jenkinson, T
Explicit versus Implicit Profit Sharing and the Determination of Wages: Microeconomic Evidence from the UK.
title Explicit versus Implicit Profit Sharing and the Determination of Wages: Microeconomic Evidence from the UK.
title_full Explicit versus Implicit Profit Sharing and the Determination of Wages: Microeconomic Evidence from the UK.
title_fullStr Explicit versus Implicit Profit Sharing and the Determination of Wages: Microeconomic Evidence from the UK.
title_full_unstemmed Explicit versus Implicit Profit Sharing and the Determination of Wages: Microeconomic Evidence from the UK.
title_short Explicit versus Implicit Profit Sharing and the Determination of Wages: Microeconomic Evidence from the UK.
title_sort explicit versus implicit profit sharing and the determination of wages microeconomic evidence from the uk
work_keys_str_mv AT bhargavas explicitversusimplicitprofitsharingandthedeterminationofwagesmicroeconomicevidencefromtheuk
AT jenkinsont explicitversusimplicitprofitsharingandthedeterminationofwagesmicroeconomicevidencefromtheuk