National and sectoral influences on wage determination in Central and Eastern Europe.

The article investigates wage determination in Slovenia, Slovakia, Hungary, Poland, the Czech Republic and Lithuania. In particular, what is the relative influence of national and sectoral factors? While industrial relations in these countries are still in the process of change, different national patterns have emerged; what is their significance for wage determination? The literature on Western economies is unanimous that coordination of wage bargaining reduces wage dispersion, but disagrees on its effects on unemployment and inflation. The article provides a panel analysis for manufacturing sectors, examining average wages in the total economy and sectoral productivity. The openness of the economy, capital intensity and skill are also discussed. The results are compared with the recent index of the collective bargaining coordination by Visser and with cross-country data on union density.