Advanced Search
MyIDEAS: Login to save this paper or follow this series

Unions and labour market institutions in Europe

Contents:

Author Info

  • Daniele Checchi

    ()

  • Claudio Lucifora

Abstract

We investigate the evolution of unionisation, considering both economic and institutional factors. While economists typically study the effects of labour market institutions treating unionisation as given and focusing on rent-seeking motivations, in this paper we study how union membership is itself related to the economic environment and, in particular, to labour market institutions. We argue that, if unions provide insurance against income and/or unemployment risks, government policies aimed at increasing worker security can alter workers' incentives to join unions. The empirical analysis focuses on the evolution of union density in 14 European countries over the post-War period. The traditional view of unions as coalitions of workers engaged in rent-seeking activities is analysed and contrasted with the complementary view that unions and labour market institutions provide (second best) protection against uninsurable labour market risks. Results suggest that rent sharing behaviour is weakly related to aggregate unionisation patterns, while economic shocks and labour market institutions appear to be more relevant in explaining cross-country differences in unionisation patterns. Institutions such as employment protection legislation, wage indexation, statutory minimum wages appear to crowd out unions, while institutional features that make it easier for unions to function (such as workplace representation and centralised wage bargaining) are empirically associated with higher unionisation. In the context of the ongoing debate on flexibility-oriented reforms and evolving European institutions - such as the European Monetary Union (EMU), the European Social Charter (ESC) and more generally the system of welfare provisions - the results in this paper offer implications both for the design of European institutions as well as for future of trade unions in Europe.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://wp.demm.unimi.it/tl_files/wp/2002/DEMM-2002_016wp.pdf
Download Restriction: no

Bibliographic Info

Paper provided by Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano in its series Departmental Working Papers with number 2002-16.

as in new window
Length:
Date of creation: 01 Jan 2002
Date of revision:
Handle: RePEc:mil:wpdepa:2002-16

Contact details of provider:
Postal: Via Conservatorio 7, I-20122 Milan - Italy
Phone: +39 02 50321522
Fax: +39 02 50321505
Web page: http://www.demm.unimi.it
More information through EDIRC

Related research

Keywords: trade unions; labour market institutions; membership;

Other versions of this item:

This paper has been announced in the following NEP Reports:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Layard, Richard & Nickell, Stephen & Jackman, Richard, 1991. "Unemployment: Macroeconomic Performance and the Labour Market," OUP Catalogue, Oxford University Press, number 9780198284345, September.
  2. Olivier Blanchard & Francesco Giavazzi, 2003. "Macroeconomic Effects Of Regulation And Deregulation In Goods And Labor Markets," The Quarterly Journal of Economics, MIT Press, vol. 118(3), pages 879-907, August.
  3. Grossman, Gene M, 1983. "Union Wages, Temporary Layoffs, and Seniority," American Economic Review, American Economic Association, vol. 73(3), pages 277-90, June.
  4. Booth, Alison L, 1985. "The Free Rider Problem and a Social Custom Model of Trade Union Membership," The Quarterly Journal of Economics, MIT Press, vol. 100(1), pages 253-61, February.
  5. Freeman, Richard B, 1986. "Unionism Comes to the Public Sector," Journal of Economic Literature, American Economic Association, vol. 24(1), pages 41-86, March.
  6. Olivier Blanchard & Justin Wolfers, 1999. "The Role of Shocks and Institutions in the Rise of European Unemployment: The Aggregate Evidence," NBER Working Papers 7282, National Bureau of Economic Research, Inc.
  7. Aghion, Philippe & Hermalin, Benjamin, 1990. "Legal Restrictions on Private Contracts Can Enhance Efficiency," Journal of Law, Economics and Organization, Oxford University Press, vol. 6(2), pages 381-409, Fall.
  8. Jaakko Pehkonen & Hannu Tanninen, 1997. "Institutions, Incentives and Trade Union Membership," LABOUR, CEIS, vol. 11(3), pages 579-598, November.
  9. Nickell, Stephen & Layard, Richard, 1999. "Labor market institutions and economic performance," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 46, pages 3029-3084 Elsevier.
  10. A L Booth & M Chatterji, . "Union Membership And Wage Bargaining When Membership Is Not Compulsory," Dundee Discussion Papers in Economics 048, Economic Studies, University of Dundee.
  11. David G. Blanchflower & Robert Crouchley & Saul Estrin & Andrew Oswald, 1990. "Unemployment and the Demand for Unions," NBER Working Papers 3251, National Bureau of Economic Research, Inc.
  12. Acemoglu, Daron & Aghion, Philippe & Violante, Giovanni L, 2001. "Deunionization, Technical Change and Inequality," CEPR Discussion Papers 2764, C.E.P.R. Discussion Papers.
  13. Belot, M.V.K. & Ours, J.C. van, 2000. "Does the Recent Success of some OECD Countries in Lowering their Unemployment Rates lie in the Clever Design of their Labour Market Reforms?," Discussion Paper 2000-40, Tilburg University, Center for Economic Research.
  14. Rodrik, Dani, 1996. "Why do More Open Economies Have Bigger Governments?," CEPR Discussion Papers 1388, C.E.P.R. Discussion Papers.
  15. Booth, Alison L, 1984. "A Public Choice Model of Trade Union Behaviour and Membership," Economic Journal, Royal Economic Society, vol. 94(376), pages 883-98, December.
  16. Carruth, Alan A & Disney, Richard F, 1988. "Where Have Two Million Trade Union Members Gone?," Economica, London School of Economics and Political Science, vol. 55(217), pages 1-19, February.
  17. Naylor, Robin & Cripps, Martin, 1993. "An economic theory of the open shop trade union," European Economic Review, Elsevier, vol. 37(8), pages 1599-1620, December.
  18. Holmlund, Bertil & Lundborg, Per, 1999. "Wage bargaining, union membership, and the organization of unemployment insurance," Labour Economics, Elsevier, vol. 6(3), pages 397-415, September.
  19. Lazear, Edward P, 1990. "Job Security Provisions and Employment," The Quarterly Journal of Economics, MIT Press, vol. 105(3), pages 699-726, August.
  20. James Peoples, 1998. "Deregulation and the Labor Market," Journal of Economic Perspectives, American Economic Association, vol. 12(3), pages 111-130, Summer.
  21. Daveri, Francesco & Tabellini, Guido, 1997. "Unemployment, Growth and Taxation in Industrial Countries," CEPR Discussion Papers 1681, C.E.P.R. Discussion Papers.
  22. Richard Freeman & Jeffrey Pelletier, 1989. "The Impact of Industrial Relations Legislation on British Union Density," NBER Working Papers 3167, National Bureau of Economic Research, Inc.
  23. Akerlof, George A, 1980. "A Theory of Social Custom, of Which Unemployment May be One Consequence," The Quarterly Journal of Economics, MIT Press, vol. 94(4), pages 749-75, June.
  24. Burda, Michael C, 1990. "Membership, Seniority and Wage-Setting in Democratic Labour Unions," Economica, London School of Economics and Political Science, vol. 57(228), pages 455-66, November.
  25. Naylor, Robin & Raaum, Oddbjorn, 1993. "The Open Shop Union, Wages, and Management Opposition," Oxford Economic Papers, Oxford University Press, vol. 45(4), pages 589-604, October.
  26. Stephen Nickell, 1997. "Unemployment and Labor Market Rigidities: Europe versus North America," Journal of Economic Perspectives, American Economic Association, vol. 11(3), pages 55-74, Summer.
  27. Bertola, Giuseppe, 1990. "Job security, employment and wages," European Economic Review, Elsevier, vol. 34(4), pages 851-879, June.
  28. Jones, Stephen R G & McKenna, C J, 1994. "A Dynamic Model of Union Membership and Employment," Economica, London School of Economics and Political Science, vol. 61(242), pages 179-89, May.
  29. Corneo, Giacomo G., 1997. "The theory of the open shop trade union reconsidered," Labour Economics, Elsevier, vol. 4(1), pages 71-84, March.
  30. Giuseppe Bertola & Francine D. Blau & Lawrence M. Kahn, 2001. "Comparative Analysis of Labor Market Outcomes: Lessons for the US from International Long-Run Evidence," NBER Working Papers 8526, National Bureau of Economic Research, Inc.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
This item has more than 25 citations. To prevent cluttering this page, these citations are listed on a separate page.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:mil:wpdepa:2002-16. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (DEMM Working Papers) The email address of this maintainer does not seem to be valid anymore. Please ask DEMM Working Papers to update the entry or send us the correct address.

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.