TY  - JOUR
AU  - Gyourko,Joseph
AU  - Tracy,Joseph
TI  - Public Sector Bargaining and the Local Budgetary Process
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 2915
PY  - 1989
Y2  - March 1989
UR  - http://www.nber.org/papers/w2915
L1  - http://www.nber.org/papers/w2915.pdf
N1  - Author contact info:
Joseph Gyourko
University of Pennsylvania
Wharton School of Business
3620 Locust Walk
1480 Steinberg-Dietrich Hall
Philadelphia, PA 19104-6302
Tel: 215/898-3003
Fax: 215/573-2220
E-Mail: gyourko@wharton.upenn.edu

Joseph Tracy
Executive Vice President
Federal Reserve Bank of New York
33 Liberty Street
New York, NY 10045
Tel: 212/720-6344
E-Mail: joseph.tracy@ny.frb.org
AB  - This paper investigates how the fiscal environment and the budgetary process affect wage and employment determination in the local public sector. The structure of the local tax system is found to be influential with significantly higher wages occurring in cities with access to local sales and/or income taxes. State-imposed property tax limits are found to be associated with lower wages (but not overall payrolls per capita). We find evidence that skill enhancement may be an important policy tool. Local governments appear to successfully use it to mitigate the wage premia associated with strong state collective bargaining legislation. We also find that controlling for the human capital of teachers substantially reduces the well-known positive correlation between teacher wages and community income.
ER  -