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'Living' wage, class conflict and ethnic strife
[journal article]
Abstract We examine how group-specific differences in reservation wage, arising due to asymmetries in social entitlements, impact distribution via the joint determination of class conflict between workers and employers, and 'ethnic' conflict among workers. We model a two-dimensional contest, where two unions... view more
We examine how group-specific differences in reservation wage, arising due to asymmetries in social entitlements, impact distribution via the joint determination of class conflict between workers and employers, and 'ethnic' conflict among workers. We model a two-dimensional contest, where two unions, representing different sections of workers, jointly but non-cooperatively invest resources against employers in enforcing an exogenously given rent, while also contesting one another. The rent arises from a 'living' wage, set above reservation wage rates via labour regulations. We show that high reservation wage workers gain, and employers lose, from better social entitlements for low reservation wage workers. The latter however benefit, with employers and against the former, from weak labour regulations. When minority/ immigrant workers are marginalized both in the labour market and in non-wage entitlements, improving job access and expanding 'social support' has contradictory effects on class and ethnic conflicts. 'Trade unionism', i.e. political articulation of shared economic interests alone, appears insufficient to temper ethnic conflicts among workers.... view less
Classification
Social Problems
Sociology of Work, Industrial Sociology, Industrial Relations
Free Keywords
D31; D72; D74; I38; J52; O17; Class conflict; Ethnic conflict; Living wage; Labour regulation; Social entitlement; Affirmative action; Distribution
Document language
English
Publication Year
2009
Page/Pages
750–765 p.
Journal
Journal of Economic Behavior & Organization, 72 (2009) 2
DOI
https://doi.org/10.1016/j.jebo.2009.07.009
Status
Postprint; peer reviewed
Licence
PEER Licence Agreement (applicable only to documents from PEER project)