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Erosion of the Ghent System and Union Membership Decline: Lessons from Finland

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  • Petri Böckerman
  • Roope Uusitalo

Abstract

Union density declined in Finland by more than 10 percentage points in less than 10 years. This paper analyses the reasons behind the decline, using micro data from the 1990s. According to our results, the changes in the composition of the labour force and the changes in the labour market explain only about a quarter of this decline. The main reason for the decline appears to be the erosion of the Ghent system, due to the emergence of an independent unemployment insurance fund that provides unemployment insurance without requiring union membership. We also find that the decline in the union density can be attributed to the declining inclination of the cohorts born after the early 1960s to become union members. Copyright Blackwell Publishing Ltd/London School of Economics 2006.

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Bibliographic Info

Article provided by London School of Economics in its journal British Journal of Industrial Relations.

Volume (Year): 44 (2006)
Issue (Month): 2 (06)
Pages: 283-303

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Handle: RePEc:bla:brjirl:v:44:y:2006:i:2:p:283-303

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Cited by:
  1. Yuriy Gorodnichenko & Enrique G. Mendoza & Linda L. Tesar, 2012. "The Finnish Great Depression: From Russia with Love," American Economic Review, American Economic Association, vol. 102(4), pages 1619-44, June.
  2. Erling Barth & Karl O. Moene, 2009. "The Equality Multiplier," NBER Working Papers 15076, National Bureau of Economic Research, Inc.
  3. John Schmitt & Alexandra Mitukiewicz, 2012. "Politics matter: changes in unionisation rates in rich countries, 1960–2010," Industrial Relations Journal, Wiley Blackwell, vol. 43(3), pages 260-280, 05.
  4. Böckerman, Petri & Uusitalo, Roope, 2007. "Minimum wages and youth employment: Evidence from the Finnish retail trade sector," MPRA Paper 6113, University Library of Munich, Germany.
  5. Böckerman, Petri & Laukkanen, Erkki, 2008. "What makes you work while you are sick? Evidence from a survey of union members," MPRA Paper 10556, University Library of Munich, Germany.
  6. Laszlo Goerke & Markus Pannenberg, 2007. "Trade Union Membership and Works Councils in West Germany," Industrielle Beziehungen - Zeitschrift fuer Arbeit, Organisation und Management - The German Journal of Industrial Relations, Rainer Hampp Verlag, vol. 14(2), pages 154 - 175.
  7. Petri Bockerman & Erkki Laukkanen, 2009. "Presenteeism in Finland: Determinants By Gender and The Sector of Economy," Ege Academic Review, Ege University Faculty of Economics and Administrative Sciences, vol. 9(3), pages 1007-1016.
  8. Böckerman, Petri & Laaksonen, Seppo & Vainiomäki, Jari, 2006. "Micro-level evidence on wage rigidities in Finland," MPRA Paper 1811, University Library of Munich, Germany.
  9. Schnabel, Claus & Schank, Thorsten, 2008. "The aging of the unions in West Germany, 1980 - 2006," Discussion Papers 60, Friedrich-Alexander-University Erlangen-Nuremberg, Chair of Labour and Regional Economics.
  10. Böckerman, Petri & Laaksonen, Seppo & Vainiomäki, Jari, 2009. "Micro-level Rigidity vs. Macro-level Flexibility: Lessons from Finland," MPRA Paper 15061, University Library of Munich, Germany.
  11. Schnabel, Claus, 2012. "Union membership and density: Some (not so) stylized facts and challenges," Discussion Papers 81, Friedrich-Alexander-University Erlangen-Nuremberg, Chair of Labour and Regional Economics.

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