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Local wage bargaining reduces wage gaps for foreign workers in Denmark.

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Local institutions, union wage effects and native–foreign wage gaps
Torben Dall Schmidt

Paper Summary

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Local wage bargaining in Danish firms helps reduce wage gaps between workers from different countries. Union membership also plays a role in narrowing these gaps. However, local peer effects may actually increase wage gaps for workers from Poland. Overall, the study shows that local institutions and collective bargaining can impact wage differences among workers of various nationalities.