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The Rise and Fall of Unionised Labour Markets: A Political Economy Approach

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  • Woojin Lee
  • John E. Roemer

Abstract

Studying a model where trade unions interact with endogenously formed partisan political parties, we explain changing political preferences for and against the unionised labour market regime. We focus on the changes in coalition formation between unskilled and moderately skilled workers, which in turn depend on inequality among workers. When inequality is either very low or very high, moderately skilled workers form a political coalition with unskilled workers to support a unionised labour market regime. In other cases, the economic interest of the moderately skilled workers is more in line with that of highly skilled workers and capital owners to support a competitive labour market regime. Copyright 2005 Royal Economic Society.

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Bibliographic Info

Article provided by Royal Economic Society in its journal The Economic Journal.

Volume (Year): 115 (2005)
Issue (Month): 500 (01)
Pages: 28-67

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Handle: RePEc:ecj:econjl:v:115:y:2005:i:500:p:28-67

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Cited by:
  1. Indraneel Dasgupta, . "‘Living’ wage, class conflict and ethnic strife," Discussion Papers 08/08, University of Nottingham, CREDIT.
  2. Campante, Filipe R., 2011. "Redistribution in a model of voting and campaign contributions," Journal of Public Economics, Elsevier, vol. 95(7), pages 646-656.
  3. Llavador, Humberto & Solano-García, Angel, 2011. "Immigration policy with partisan parties," Journal of Public Economics, Elsevier, vol. 95(1-2), pages 134-142, February.
  4. De Donder, Philippe & Hindriks, Jean, 2007. "Equilibrium Social Insurance with Policy-Motivated Parties ," Open Access publications from University of Toulouse 1 Capitole http://neeo.univ-tlse1.fr, University of Toulouse 1 Capitole.
  5. Xiujian Chen & Shu Lin & W. Robert Reed, 2006. "Another Look at what to do with Time-series Cross-section Data," Working Papers in Economics 06/04, University of Canterbury, Department of Economics and Finance.
  6. Anesi, Vincent & De Donder, Philippe, 2009. "A Positive Theory of Unemployment Insurance and Employment Protection," CEPR Discussion Papers 7333, C.E.P.R. Discussion Papers.
  7. John E. Roemer, 2004. "Distribution and Politics: A Brief History and Prospect," Cowles Foundation Discussion Papers 1487, Cowles Foundation for Research in Economics, Yale University.

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