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The Single Mindedness Theory of Labor Unions

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Author Info
canegrati, emanuele

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Abstract

In this paper I analyse a labor market where the wage is endogenously determined according to a Right-to-Manage bargaining process between a firm and a labor union whose members are partitioned into two social groups: the old and the young. Furthermore, I exploit the Single Mindedness theory, which considers the existence of a density function which endogenously depends on leisure. I demonstrate that, when preferences of the old for leisure are higher than those of the young and when the level of productivity of the young is higher than that of the old, the young suer from higher tax rates and gain higher level of wage rates and lower levels of leisure. Finally, since the old are more single minded than the young, they exploit their greater political power to get positive transfers from the young in a PAYG system.

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File URL: http://mpra.ub.uni-muenchen.de/1224/
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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 1224.

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Date of creation: Dec 2006
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Handle: RePEc:pra:mprapa:1224

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Related research
Keywords: bargaining models labor unions political economy single mindedness

Find related papers by JEL classification:
J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
J58 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Public Policy
J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy-Making and Implementation
D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Models of Political Processes: Rent-seeking, Elections, Legislatures, and Voting Behavior
J52 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Dispute Resolution: Strikes, Arbitration, and Mediation

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  15. Paola Profeta, 2002. "Retirement and Social Security in a Probabilistic Voting Model," International Tax and Public Finance, Springer, vol. 9(4), pages 331-348, August. [Downloadable!] (restricted)
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