Institutions and Wage Formation in the New Europe

This text addresses the role played by institutions in European wage formation with a focus on EMU and institutional change in Labour Markets. Under the general heading there are three broad but distinct themes. The first emphasises the role of institutions in affecting the dispersion of wages across occupation, age, skill, and industry and employment contract categories. The contributors make clear the profound effect that Euopean instiutions can have in influencing, and in most cases compressing, such pay differentials with consequent imlpications for the employment prospects of certain segments of the labour force. The second theme is the explanation for recent wage moderation in Europe. The contributions under this theme stress the role of developments in the bargaining systems of European countries and the presence of a number of temporary or specific factors, which have helped to bring about pay moderation. The final theme is the extent to which institutions are changing within Europe in the light of EMU and the adoption of new business practices.