"After reviewing the different theories on the impact of EMU on wage policies and the way in which trade unions have sought to organise international coordination of wage bargaining in Europe, this article investigates whether EMU has had an effect on wage formation. It finds that there is indeed such an effect. EMU has gone hand in hand with relatively lower wage increases than in the pre-EMU period. European coordination of wage bargaining therefore remains necessary and has to be strengthened. This article also describes the interaction that has taken place over the last five years between wage formation on the one hand and macroeconomic policies on the other. We find that here there is much scope for an improved and more intense dialogue between trade unions, the ECB and governments."

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