Wage Determination In The Public Sector

Abstract

As the economy continues to recover from the recent recession of 2008-2009, there has been much discussion of the related issues of increases in federal, state, and local budget deficits and debt. A major element of that discussion concerns public employee salaries and benefits, including under-funded pension benefits. This paper involves the development of a theoretical model for the determination of wages and salaries in the public sector which has implications for these current issues.