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Unemployment Insurance and Union Wage Setting

Author

Listed:
  • Holmlund, Bertil
  • Lundborg, Per

Abstract

The authors examine alternative systems of financing unemployment insurance benefits in an economy with wage-sett ing unions, where, as in some Nordic countries, each union runs its o wn unemployment insurance system. It is shown that a higher lump-sum grant to the union's unemployment insurance fund increases employment , whereas higher marginal subsidies have ambiguous effects. An unempl oyment insurance tax on wages has no effect on employment, whereas an unemployment insurance tax on profits unambiguously increases employ ment. The authors also analyze a case where wages are set at the firm level and premiums at the industry level. Copyright 1988 by The editors of the Scandinavian Journal of Economics.

Suggested Citation

  • Holmlund, Bertil & Lundborg, Per, 1988. " Unemployment Insurance and Union Wage Setting," Scandinavian Journal of Economics, Wiley Blackwell, vol. 90(2), pages 161-172.
  • Handle: RePEc:bla:scandj:v:90:y:1988:i:2:p:161-72
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    Citations

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    Cited by:

    1. Marcus Dittrich, 2010. "Welfare Effects of Local versus Central Wage Bargaining," LABOUR, CEIS, vol. 24(1), pages 26-34, March.
    2. Calmfors, Lars, 1995. "Labour market policy and unemployment," European Economic Review, Elsevier, vol. 39(3-4), pages 583-592, April.
    3. 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.
    4. Jonas Agell, 2004. "Efficiency and Equality in the Labour Market," CESifo Economic Studies, CESifo, vol. 50(2), pages 255-278.
    5. repec:pri:cepsud:158krueger is not listed on IDEAS
    6. Wehke, Sven, 2009. "Union wages, hours of work and the effectiveness of partial coordination agreements," Labour Economics, Elsevier, vol. 16(1), pages 89-96, January.
    7. Dittrich, Marcus, 2006. "Welfare Effects of Union Bargaining Centralisation in a Two-Sector Economy," MPRA Paper 11, University Library of Munich, Germany, revised Sep 2006.
    8. repec:ces:ifodic:v:3:y:2005:i:2:p:14567656 is not listed on IDEAS
    9. Anders Forslund & Alan Krueger, 2010. "Did Active Labor Market Policies Help Sweden Rebound from the Depression of the Early 1990s?," NBER Chapters,in: Reforming the Welfare State: Recovery and Beyond in Sweden, pages 159-187 National Bureau of Economic Research, Inc.
    10. Eric Levin & Thomas Moutos, 1991. "Unemployment insurance and union bargaining — an insider-outsider approach," Journal of Economics, Springer, vol. 53(3), pages 271-284, October.
    11. Burda, Michael C., 1997. "Corporatism, labor unions and the safety net," European Economic Review, Elsevier, vol. 41(3-5), pages 635-646, April.
    12. Sinko, Pekka, 2003. "Subsidizing vs. Experience Rating of Unemployment Insurance in Unionized Labor Markets," Discussion Papers 319, VATT Institute for Economic Research.
    13. Goerke, Laszlo & Madsen, Jakob B., 2003. "Earnings-Related Unemployment Benefits in a Unionised Economy," IZA Discussion Papers 701, Institute for the Study of Labor (IZA).
    14. Goerke, Laszlo & Madsen, Jakob B., 2003. "Earnings-related unemployment benefits and unemployment," Economic Systems, Elsevier, vol. 27(1), pages 41-62, March.
    15. Julia Fath & Clemens Fuest, 2005. "Experience Rating of Unemployment Insurance in the US: A Model for Europe?," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 3(2), pages 45-50, 07.

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