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A Dynamic Model of Union Membership and Employment

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  • Jones, Stephen R G
  • McKenna, C J

Abstract

This paper incorporates the ideas that a union maximizes an intertemporal objective function, that it recognizes some link between present wage and employment levels and future membership, and that it has an interest in the level of membership attained. The authors model membership decisions with stochastic demand and a differential layoff rate for union and nonunion workers. Membership dynamics are behavioral in that membership increases when the utility of being a member exceeds the utility of not being a member. The model permits a variety of possible relationships between employment and membership in the adjustment to steady state. Copyright 1994 by The London School of Economics and Political Science.

Suggested Citation

  • 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 179-189, May.
  • Handle: RePEc:bla:econom:v:61:y:1994:i:242:p:179-89
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    Cited by:

    1. Schirwitz, Beate & Dittrich, Marcus, 2006. "A Dynamic Model of Union Behaviour. The Role of an Endogenous Outside Option and Bargaining Centralisation," Dresden Discussion Paper Series in Economics 07/06, Technische Universität Dresden, Faculty of Business and Economics, Department of Economics.
    2. Schnabel, Claus & Wagner, Joachim, 2003. "Trade union membership in Eastern and Western Germany: convergence or divergence?," Discussion Papers 18, Friedrich-Alexander University Erlangen-Nuremberg, Chair of Labour and Regional Economics.
    3. Laszlo Goerke & Markus Pannenberg, 2007. "Trade Union Membership and Works Councils in West Germany," Industrielle Beziehungen - Zeitschrift fuer Arbeit, Organisation und Management - The German Journal of Industrial Relations, Rainer Hampp Verlag, vol. 14(2), pages 154-175.
    4. repec:ebl:ecbull:v:10:y:2005:i:2:p:1-10 is not listed on IDEAS
    5. Goerke, Laszlo & Pannenberg, Markus, 2011. "Trade union membership and dismissals," Labour Economics, Elsevier, vol. 18(6), pages 810-821.
    6. Enrico Marchetti, 1998. "Dynamic Games and Growth Cycles in Unionised Economies," Working Papers 32, University of Rome La Sapienza, Department of Public Economics.
    7. Schnabel, Claus & Wagner, Joachim, 2005. "Determinants of Union Membership in 18 EU Countries : Evidence from Micro Data, 2002/03," Discussion Papers 31, Friedrich-Alexander University Erlangen-Nuremberg, Chair of Labour and Regional Economics.
    8. Daniele Checchi, 2000. "Time series evidence on union densities in European countries," Departmental Working Papers 2000-10, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
    9. Nyssens, Marthe & Van der Linden, Bruno, 2000. "Embeddedness, cooperation and popular-economy firms in the informal sector," Journal of Development Economics, Elsevier, vol. 61(1), pages 175-204, February.
    10. Chang, Juin-jen & Lai, Ching-chong, 1997. "Union membership and employment dynamics with endogenous union density," Economics Letters, Elsevier, vol. 57(1), pages 119-125, November.
    11. Daniele Checchi & Claudio Lucifora, 2002. "Unions and labour market institutions in Europe," Economic Policy, CEPR;CES;MSH, vol. 17(35), pages 361-408, October.
    12. Bruno Chiarini & Paolo Piselli, 2012. "Equilibrium earning premium and pension schemes: The long-run macroeconomic effects of the union," Discussion Papers 2_2012, D.E.S. (Department of Economic Studies), University of Naples "Parthenope", Italy.
    13. Adriana Cassoni, 1997. "A brief survey on the role of trade unions in labour market," Documentos de Trabajo (working papers) 0697, Department of Economics - dECON.
    14. Schnabel, Claus, 2002. "Determinants of trade union membership," Discussion Papers 15, Friedrich-Alexander University Erlangen-Nuremberg, Chair of Labour and Regional Economics.
    15. Lai, Ching-chong & Chang, Juin-jen & Chang, Wen-ya, 2001. "Currency devaluation in an open-shop union," International Review of Economics & Finance, Elsevier, vol. 10(1), pages 61-74.
    16. Schnabel, Claus & Wagner, Joachim, 2003. "Determinants of Trade Union Membership in Western Germany: Evidence from Micro Data, 1980-2000," IZA Discussion Papers 708, Institute for the Study of Labor (IZA).
    17. Edgar Preugschat, 2009. "Unionization Patterns and Firm Reallocation," 2009 Meeting Papers 1114, Society for Economic Dynamics.
    18. Moreton, David R., 1998. "An open shop trade union model of wages, effort and membership," European Journal of Political Economy, Elsevier, vol. 14(3), pages 511-527, August.

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