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Wage Setting in Democratic Labour Unions

Author

Listed:
  • Filges, T.

Abstract

In this paper, we analyse the wage setting of a democratic labour union. The union members differ with respect to their employment probabilities. The union wage only changes if the parameters of the median member change. An exogenous shock to revenue may increase the wage, even if labour demand is iso-elastic and unemployment benefits may have only a small effect on wages if the median member differs from the average. These findings are in accordance with empirical results.

Suggested Citation

  • Filges, T., 1999. "Wage Setting in Democratic Labour Unions," Papers 99-08, Centre for Labour Market and Social Research, Danmark-.
  • Handle: RePEc:fth:clmsre:99-08
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    More about this item

    Keywords

    UTILITY ; EMPLOYMENT ; WORKERS' REPRESENTATION;

    JEL classification:

    • E2 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment
    • J2 - Labor and Demographic Economics - - Demand and Supply of Labor
    • J6 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers

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