Understanding wage restraint in the German public sector: does the pattern bargaining hypothesis really hold water?

Abstract

German public sector wage restraint has been explained through the presence of a specific type of inter‐sectoral wage coordination in the industrial relations system—that is, export sector‐led pattern bargaining. First, as a literature‐assessing exercise, this paper reviews the literature in industrial relations and comparative political economy (CPE) and finds that (i) the origins and mechanics of inter‐sectoral wage coordination through pattern bargaining have never been laid out clearly; (ii) that the mechanisms of the pattern bargaining thesis have never been tested empirically; and (iii) that the CPE literature reveals an export‐sector bias. Second, as a theory‐testing exercise, hoop tests are performed to verify the pattern bargaining hypothesis. The key finding is that Germany cannot be considered a case of export sector‐driven pattern bargaining, opening a new research agenda for the study of public sector wage setting centred on public sector employment relations, public finance, public administrations and the politics of fiscal policy.

The new political economy of public sector wage-setting in Europe: Introduction to the special issue

“…Thus, the outcomes of PSWS appear aligned to the regimes' functional requirements. However, contrary to what is generally assumed in the CPE literature, wage restraint in the German public sector is not an outcome driven by the domination of export sector actors in the wage-setting arena (on this point, see also Di Carlo (2019Carlo ( , 2020Carlo ( , 2022). On the contrary, the article highlights key patterns of institutional change in the institutions of the state specific to PSWS and changing power resources.…”

Business Against Markets: Employer Resistance to Collective Bargaining Liberalization During the Eurozone Crisis

“…This is due to the fact that, when setting public wages, the government acts both as an employer and as an enforcer of the negotiating outcome. This in turn creates a specific political tension between the responsible and responsive functions of elected governments (for a detailed analysis see Di Carlo, 2018), different in nature from that between governments and domestic employers that we are exploring here. We therefore restrict our focus to the regulatory functions of the state.…”

Public sector employment relations: Germany in comparative perspective

“…Austria and Germany might be cases for the latter: both have pattern bargaining systems where wage-setters in all sectors (usually) shadow the metalworking industry' (Johnston and Hancké, 2009: 615). 4 However, in empirical regard, this hypothesis of inter-sectoral dependence is definitely not correct, at least not for Germany (for empirical details, Di Carlo, 2019Carlo, , 2020. The ps follows private industry neither formally nor informally in a model of inter-sectoral dependence.…”

“…However, in empirical regard, this hypothesis of inter-sectoral dependence is definitely not correct, at least not for Germany (for empirical details, Di Carlo, 2019, 2020). The ps follows private industry neither formally nor informally in a model of inter-sectoral dependence.…”