Stronger Incentives for Cost Efficiency Could Boost Worker Wages in Regulated Industries
This paper investigates how wages being set through negotiations at companies can impact how regulations on businesses work in industries like healthcare or transportation. The researchers found that when workers have a strong say in wages, businesses have more motivation to be efficient to keep costs down, compared to when wages are set independently of regulations. This means in regulated sectors where unions have power, companies might work harder to operate efficiently.