Project description
Understanding collusion in labour markets
Worker mobility is critical to a healthy labour market, but wage-fixing, no-poaching and non-compete practices can restrict worker opportunities. Anticompetitive practices such as these have attracted growing attention from policymakers and regulators. However, little is known about their overall economic impacts or how they interact with unions or pay transparency initiatives. With this in mind, the ERC-funded COLLABOR project seeks to fill the gap by developing (and validating) transparent models that can be used to understand and quantify the effects of such practices on wages, employment and economic welfare in general. Ultimately, the project aims to inform antitrust policies.
Objective
In recent years, the European Commission and national competition authorities have shown significant interest in collusion and anticompetitive practices in labor markets. While extensive research has enhanced our understanding of imperfectly competitive labor markets, a critical gap remains in our comprehension of modern anticompetitive practices and explicit collusion by employers. Additionally, recent evidence suggests that unions might alleviate the negative wage effects of employment concentration on wages, but we know little about how unions might serve as a remedy against anticompetitive employment practices.
To address these gaps, I propose the following research agenda: First, I will develop a benchmark theoretical model to study various anticompetitive practices in labor markets, including wage-fixing, no-poaching agreements, and noncompete clauses. A main purpose of this model is to provide a transparent approach to quantify the impact of these practices on wages, employment, and overall economic welfare using readily available data. Second, I will extend this model to incorporate the role of unions and asymmetric information, exploring how unions might counteract anticompetitive practices and interact with pay transparency initiatives. Third, I will confront the theoretical framework with empirical evidence on firm pay dynamics, thereby working to reconcile two large literatures on firm dynamics and pay premiums across firms. I will document empirical patterns using recently developed reduced-form methods and employer-employee data and examine the implications for the structure of labor market frictions. This analysis will assess the consistency of the models with observed patterns in wages, productivity, and worker mobility. Ultimately, this research aims to inform antitrust policies by developing and empirically assessing a comprehensive model of anticompetitive practices in labor markets, incorporating unions, information frictions, and firm dynamics.
Fields of science (EuroSciVoc)
CORDIS classifies projects with EuroSciVoc, a multilingual taxonomy of fields of science, through a semi-automatic process based on NLP techniques. See: The European Science Vocabulary.
CORDIS classifies projects with EuroSciVoc, a multilingual taxonomy of fields of science, through a semi-automatic process based on NLP techniques. See: The European Science Vocabulary.
- social sciences economics and business economics production economics productivity
- social sciences economics and business business and management employment
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Programme(s)
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Multi-annual funding programmes that define the EU’s priorities for research and innovation.
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HORIZON.1.1 - European Research Council (ERC)
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Calls for proposals are divided into topics. A topic defines a specific subject or area for which applicants can submit proposals. The description of a topic comprises its specific scope and the expected impact of the funded project.
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Funding scheme (or “Type of Action”) inside a programme with common features. It specifies: the scope of what is funded; the reimbursement rate; specific evaluation criteria to qualify for funding; and the use of simplified forms of costs like lump sums.
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Call for proposal
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Procedure for inviting applicants to submit project proposals, with the aim of receiving EU funding.
(opens in new window) ERC-2025-STG
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EH8 9YL Edinburgh
United Kingdom
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