Sectoral Bargaining and the Wage Structure (in Germany)

Friday, April 10, 2026
12:00pm
Room 103, Janice Levin Building, Livingston Campus

Co-Sponsored by SMLR’s Center for Global Work and Employment

For more information, please contact Laura Walkoviak (lauraann@smlr.rutgers.edu)

Abstract

Most European labor markets are structured by industry-wide wage bargaining. We study the relationship between sectoral bargaining and wage inequality by differentiating between wage coordination (i.e., inequality in wage floors) and wage centralization (i.e., inequality in deviations from wage floors). We introduce a novel data set of over 30,000 major German sectoral bargaining agreements between 1950 and 2025 which lets us reconstruct wage coordination for the history of the Federal Republic of Germany. We find that inequality in bargained wage floors declined substantially between 1960 and 2025. This is driven by white collar contracts and the service industry and mainly occurs within-contract. Contracts also become less regionally and demographically differentiated over time. These findings contrast with rising wage inequality during our later study period and show that wage inequality in Germany has not been driven by bargaining fragmentation, but by decentralization.

About Our Speaker

Alexander Busch is a PhD student at the Institute for Work and Employment Research at the MIT Sloan School of Management. He is a Beyster Fellow at the Institute for the Study of Employee Ownership at Rutgers University and a Graduate Affiliate at the Center for European Studies at Harvard University. Before his PhD, he worked as a Research Associate at IZA, MIT, and at UC Berkeley. Alexander studied Economics (B.Sc., M.Sc.) and Sociology (B.A.) at Universität Heidelberg and the London School of Economics and Political Science. His research focuses on statistical methods, co-determination, and collective bargaining.

Kilian Weil is a PhD candidate at the Hertie School in Berlin. He previously worked with the European Commission, the Organisation for Economic Co-operation and Development (OECD), and the United Nations. His research connects technological transformation, collective interest representation, and empirical labor-market research. Kilian earned a B.A. in Sociology and Political Science from Ludwig-Maximilians-Universität München and an M.A. in Sociology from Freie Universität Berlin.