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The Rise and Fall of Unions in the United States

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Abstract

Union membership displayed an inverted-U-shaped pattern over the 20th century, while the distribution of income sketched a U. A model of unions is developed to analyze these phenomena. There is a distribution of firms in economy. Firms hire capital, plus skilled and unskilled labor. Unionization is a costly process. A union decides how many firms to organize and its members' wage rate. Simulation of the developed model establishes that skilled-biased technological change, which affects the productivity of skilled labor relative to unskilled labor, can potentially explain the observed paths for union membership and income inequality. In Journal of Monetary Economics (October 2016), v. 83: 129-146.

Suggested Citation

  • Emin Dinlersoz & Jeremy Greenwood, 2012. "The Rise and Fall of Unions in the United States," Economie d'Avant Garde Research Reports 19, Economie d'Avant Garde.
  • Handle: RePEc:eag:rereps:19
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    Cited by:

    1. Song, Yang & Yang, Jidong & Yang, Qijing, 2016. "Do firms' political connections depress the union wage effect? Evidence from China," China Economic Review, Elsevier, vol. 38(C), pages 183-198.
    2. repec:eee:quaeco:v:67:y:2018:i:c:p:326-333 is not listed on IDEAS
    3. Emin Dinlersoz & Jeremy Greenwood & Henry Hyatt, 2014. "Who do Unions Target? Unionization over the Life-Cycle of U.S. Businesses," NBER Working Papers 20151, National Bureau of Economic Research, Inc.
    4. Brändle, Tobias & Baumann, Florian, 2013. "Union Bargaining and Intra-Industry Productivity Differentials: Theory and Evidence from Germany," Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 79852, Verein für Socialpolitik / German Economic Association.
    5. Krusell, Per & Rudanko, Leena, 2016. "Unions in a frictional labor market," Journal of Monetary Economics, Elsevier, vol. 80(C), pages 35-50.
    6. Bridgman, Benjamin, 2015. "Competition, work rules and productivity," Journal of Economic Dynamics and Control, Elsevier, vol. 52(C), pages 136-149.

    More about this item

    Keywords

    Computer Age; Deunionization; Distribution of Income; Flexible Manufacturing; Mass Production; Numerically Controlled Machines; Skill-Biased Technological Change; Simulation Analysis; Union Membership;

    JEL classification:

    • J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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