The Research Of Economic Effect On Wage Collective Negotiation

Wage Collective Negotiation (Westerns scholars call it Collective Bargaining) is the principal mode that determines the wage in western labor force market, which has been promoted in China in recently years. Unfortunately, very limited literatures have implemented empirical research of WCN’s impact on wage increment and labor intensity from micro perspective. Under this circumstance, this article attempts to investigate the economic effect of WCN through the detailed survey analysis in Hangzhou.The article first reviews and describes the historical development and status quo of Chinese domestic WCN, finding the rapid development, increasing coverage on corporations and employees, and government-oriented as its distinctive characteristics with the combination of statistic analysis. In order to further observe its economic effect, the article has made use of the data collected in "2011 Hangzhou Labor Relation Index Survey", adopting the statistic analysis method & approximated difference-in-differences model respectively to implement the empirical research of the WCN’s impact on corporation’s profit margin, employee’s wage increment and labor intensity. Statistic analysis suggests no significant difference in terms of profit margin whether the enterprises have adopted WCN. The regression result manifests a lower wage increment in enterprises that execute WCN compared to those don’t, which indicates its negative net effect on employee wage increment. In addition, through the regression analysis and difference calculus of employee’s monthly working hours, the research finds the corporations that implement WCN have a longer labor working hours than those don’t. In other words, though reflecting a higher labor intensity, the enterprises that adopt WCN have a lower wage growth rate. In that case, due to the existing problems in negotiating subject, government and institution itself, WCN has a limited impact on accelerating the increment of labor’s wage.