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Segmentation, switching costs and the demand for unionization in Britain

Listed author(s):
  • Alex Bryson
  • Rafael Gomez

This paper explains why some employees who favor unionization fail to join, and why others who wish to abandon union membership continue paying dues. Our explanation is based on a model where employees incur switching (search) costs when attempting to abandon (acquire) union membership. Empirical analysis for Britain confirms one of the main predictions from the switching-cost- model that segmentation in the market for unionization persists even when mandatory membership provisions are eliminated and economy-wide density falls. The importance of these and other empirical findings for both theory and policy are discussed.

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File URL: http://eprints.lse.ac.uk/4947/
File Function: Open access version.
Download Restriction: no

Paper provided by London School of Economics and Political Science, LSE Library in its series LSE Research Online Documents on Economics with number 4947.

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Length: 40 pages
Date of creation: May 2003
Handle: RePEc:ehl:lserod:4947
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