Lecture 10 (2) - ECOS3008 LABOUR ECONOMICS Week 13: 31 May...

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1 ECOS3008 LABOUR ECONOMICS Week 13: 31 May
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2 Wages Policy term which is accorded a wide variety of meanings. broad stance taken by a national authority towards the fixation of wages. a highly centralised form of wage fixation in which a systematically consistent set of principles is adopted by some authority whose decisions largely determine the course of wages
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3 Wages Policy Analysis here uses the broader definition wages policies of the narrower type will be termed ‘ centralised wages policies i.e. is only one particular type of wages policy. wages policy has existed in Australia for a very long time, centralised wages policies is a much more recent phenomenon, only important since 1975.
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4 Centralised Wages Policy The two most notable periods of centralised wages policy have been 1975 to 1981 (wage indexation) and 1983 to 1996 (the Accord). debate is about 1. labour market effects of centralised wage fixation, 2. causes of wage inflation, and 3. most appropriate form for an anti-inflation policy.
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5 Centralised Wages Policy Debate is on-going: centred on whether the Australian economy and society benefits more from a. fixation of wages by conciliation and arbitration, or b. the less constrained forms of collective bargaining which are found in most other Western industrialised countries. Current (2011) situation is more akin to b.
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6 Centralised Wages Policy These debates are to some extent related, mainly because the operation of conciliation and arbitration has tended to take a highly centralised form in Australia. BUT centralised wages policy centralised conciliation and arbitration it is possible to have decentralised arbitration and highly centralised collective bargaining.
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7 Wages Policy – centralised or not? main distinguishing characteristics of the Australian system of wage fixation (sect 10.2 - already discussed in Topic 1). main theories of inflation (sect 10.4), assumed from ECON1002 and/or ECOS2002 assessment of the role of a centralised wages policy as an anti-inflationary device (sect 10.5)
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8 Wages Policy – centralised or not? Enterprise bargaining (Section 10.6) human resource management generally (Ch 9) personnel economics - focus of Week 14 class Leading into labour market programs (Ch 11)
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9 Economic consequences of Aust’n wage fixation neoclassical economists argue that it impedes the attainment of allocative efficiency prevents the labour market from working in the manner postulated by the wage competition model. Institutional economists less critical of the system lesser belief in the need for wage competition they recognise that wages perform functions other than labour allocation.
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10 Economic consequences of Aust’n wage fixation Economic Effects : direct effects of wage-fixation decisions on quantities such as employment, inflation and international competitiveness. Industrial Relations Effects
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This note was uploaded on 08/22/2011 for the course FINC 2011 taught by Professor Craigmellare during the Three '10 term at University of Sydney.

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Lecture 10 (2) - ECOS3008 LABOUR ECONOMICS Week 13: 31 May...

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