A Biological Model of Unions
AbstractThis paper applies principles from evolutionary biology to the study of unions. We show that unions which maximize the present discounted wages of current members will be displaced in evolutionary competition by unions with more moderate wage policies that allow their firms to live longer. This suggests that unions with constitutional incumbency advantages that allow leaders to moderate members' wage demands may have a selective advantage. The model also suggests that industries with high turnover of firms will have low unionization rates, and that there may be one equilibrium with high unionization and long-lived firms and another with low unionization and short-lived firms. These predictions seem broadly consistent with the data.
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Bibliographic InfoPaper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 8257.
Date of creation: Apr 2001
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Find related papers by JEL classification:
- J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
- E24 - Macroeconomics and Monetary Economics - - Macroeconomics: Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution
This paper has been announced in the following NEP Reports:
- NEP-ALL-2001-05-02 (All new papers)
- NEP-EVO-2001-05-02 (Evolutionary Economics)
- NEP-HPE-2001-05-02 (History & Philosophy of Economics)
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