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This paper provides a critical survey of the literature dealing with public sector labor markets. It discusses the research by economists on wage determination in the state and local sector (including the effects of. unions), on the estimation of compensating wage differentials for pecuniary and nonpecuniary job characteristics, on the effects of unions on productivity, on the estimation of public sector demand and for labor functions, on dispute resolution, on public/private pay differentials, and on gender and race discrimination in the public sector. Numerous suggestions for future research are offered.


Suggested Citation
Ehrenberg, R. G. & Schwarz, J. L. (1983). Public sector labor markets (NBER Working Paper Series No. 1179) [Electronic version]. Cambridge, MA: National Bureau of Economic Research.

Required Publisher’s Statement
© University of Chicago Press. Reprinted with permission. All rights reserved. Later version published as: Ehrenberg, R. G. & Schwarz, J. L. (1987). Public sector labor markets. In O. Ashenfelter and R. Layard (Eds.), Handbook of labor economics: Vol. II (pp. 1219-1268). Amsterdam: Elsevier North Holland.