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Union Egalitarianism As Income Insurance

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Author Info

  • AGELL, J.
  • LOMMERUD, K.E.

Abstract

It is a common observation that unions often try to compress the wage distribution among their members as compared with the productivity distribution. A troublesome aspect of standard theories of redistributive unions is the question why high-productivity workers choose to enter the union in the first place. This paper develops and explores the implications of an alternative insurance rationale for egalitarian wage objectives. Apart from providing a simple explanation of why heterogeneous union members may agree on egalitarian wage policies, it also suggests a more guarded attitude toward the welfare costs of pay compression. Copyright 1992 by The London School of Economics and Political Science.

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Bibliographic Info

Paper provided by Uppsala - Working Paper Series in its series Papers with number 1990a.

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Length: 29 pages
Date of creation: 1990
Date of revision:
Handle: RePEc:fth:uppaal:1990a

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Keywords: trade unions ; insurance ; wages;

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