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Do trade unions care about employment? : reduced-form test results from the Finnish paper and textile industries

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  • Jaakko Pehkonen

    (University of Jyväskylä)

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    Abstract

    This study reports the results of testing the seniority model of trade union behaviour using data on two Finnish industries. We found that; (i) the empirical results do not support the idea that the aim of trade unions is merely to push their members' wages as high as possible; (ii) the relationship between the real consumption wage and aggregate unemployment is non-linear in such a way that the unemployment elasticity of the real consumption wage rises in absolute terms with the unemployment rate; and (iii) the unemployment elasticity of the real consumption wage differs significantly across the industries studied.

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    Bibliographic Info

    Article provided by Finnish Economic Association in its journal Finnish Economic Papers.

    Volume (Year): 3 (1990)
    Issue (Month): 1 (Spring)
    Pages: 26-40

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    Handle: RePEc:fep:journl:v:3:y:1990:i:1:p:26-40

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    Web page: http://www.taloustieteellinenyhdistys.fi
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    1. Holmlund, B. & Skedinger, P., 1988. "Wage Bargaining And Wage Drift: Evidence From Swedish Wood Industry," Papers 1988g, Uppsala - Working Paper Series.
    2. Oswald, A. J., 1995. "Efficient contracts are on the labour demand curve: Theory and facts," Labour Economics, Elsevier, vol. 2(1), pages 102-102, March.
    3. Blanchflower, D. & Oswald, A. & Garrett, M., 1988. "Insider Power In Wage Determination," Papers 319, London School of Economics - Centre for Labour Economics.
    4. Manning, Alan, 1987. "An Integration of Trade Union Models in a Sequential Bargaining Framework," Economic Journal, Royal Economic Society, vol. 97(385), pages 121-39, March.
    5. Holden, S., 1989. "Wage Drift In Norway: A Bargaining Approach," Papers 438, Stockholm - International Economic Studies.
    6. Holmlund, B. & Skedinger, P., 1988. "Wage Bargaining And Wage Drift: Evidence From The Swedish Wood Industry," Papers 419, Stockholm - International Economic Studies.
    7. Carruth, Alan A & Oswald, Andrew J, 1985. "Miners' Wages in Post-war Britain: An Application of a Model of Trade Union Behaviour," Economic Journal, Royal Economic Society, vol. 95(380), pages 1003-20, December.
    8. Hendry, David F & Mizon, Grayham E, 1978. "Serial Correlation as a Convenient Simplification, not a Nuisance: A Comment on a Study of the Demand for Money by the Bank of England," Economic Journal, Royal Economic Society, vol. 88(351), pages 549-63, September.
    9. Eriksson, T. & Suvanto, A. & Vartia, P., 1989. "Wage Setting In Finland," Papers 436, Stockholm - International Economic Studies.
    10. Carruth, Alan A & Oswald, Andrew J & Findlay, Lewis, 1986. "A Test of a Model of Trade Union Behaviour: The Coal and Steel Industries in Britain," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 48(1), pages 1-18, February.
    11. Oswald, Andrew J, 1985. " The Economic Theory of Trade Unions: An Introductory Survey," Scandinavian Journal of Economics, Wiley Blackwell, vol. 87(2), pages 160-93.
    12. McDonald, Ian M & Solow, Robert M, 1981. "Wage Bargaining and Employment," American Economic Review, American Economic Association, vol. 71(5), pages 896-908, December.
    13. Nickell, S J & Andrews, M, 1983. "Unions, Real Wages and Employment in Britain 1951-79," Oxford Economic Papers, Oxford University Press, vol. 35(0), pages 183-206, Supplemen.
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