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Unions and Employment in Uruguay

Author

Listed:
  • Adriana Cassoni
  • Steven G. Allen
  • Gaston J. Labadie

Abstract

This study examines the impact of unions on wages and employment using data from Uruguay in a period when unions were banned (1973-1984), then legalized with tripartite bargaining (1984-1991) followed by industry-wide or firm-specific bargaining (1992-1997). The relationship between wages and employment shifted significantly across these periods as evidenced by recursive residuals, which show structural shifts in five of six industries, with the shifts coming at the same time as the regime changes. Wages are exogenous to employment before 1985, but not afterwards. Wage elasticity and the employment-output elasticity fell sharply after 1984. Unions significantly raised wages in 1985-1992, but afterwards the change in bargaining structure and increased openness led to concessions. Starting in 1985, workers in unionized industries were less likely to be laid off than workers in nonunion industries.

Suggested Citation

  • Adriana Cassoni & Steven G. Allen & Gaston J. Labadie, 2000. "Unions and Employment in Uruguay," Research Department Publications 3092, Inter-American Development Bank, Research Department.
  • Handle: RePEc:idb:wpaper:3092
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    • Adriana Cassoni & Steven G. Allen & Gaston J. Labadie, 2004. "Unions and Employment in Uruguay," NBER Chapters,in: Law and Employment: Lessons from Latin America and the Caribbean, pages 435-496 National Bureau of Economic Research, Inc.

    References listed on IDEAS

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    Cited by:

    1. Mariano Tommasi & Silvana Tenreyro, 2001. "Comments on Dani Rodrik's "Why Is There So Much Economic Insecurity in Latin America?"," Working Papers 28, Universidad de San Andres, Departamento de Economia, revised Mar 2001.
    2. Richard B. Freeman, 2009. "Labor Regulations, Unions, and Social Protection in Developing Countries: Market distortions or Efficient Institutions?," NBER Working Papers 14789, National Bureau of Economic Research, Inc.
    3. A. Cassoni & G. Fachola & G. Labadie, 2001. "The impact of unions on the economic performance of firms," Documentos de Trabajo (working papers) 1501, Department of Economics - dECON.
    4. Lichter, Andreas & Peichl, Andreas & Siegloch, Sebastian, 2015. "The own-wage elasticity of labor demand: A meta-regression analysis," European Economic Review, Elsevier, vol. 80(C), pages 94-119.
    5. Daniel Miles & Máximo Rossi, 2001. "Wage Inequality in Developing Countries: Market Forces or Government Intervention," Documentos de Trabajo (working papers) 1001, Department of Economics - dECON.
    6. Carlos A. Arango & Ängela Milena Rojas, 2003. "Demanda Laboral en el Sector Manufacturero Colombiano:1977-1999," BORRADORES DE ECONOMIA 002270, BANCO DE LA REPÚBLICA.
    7. Fajnzylber, Pablo & Maloney, William F., 2005. "Labor demand and trade reform in Latin America," Journal of International Economics, Elsevier, vol. 66(2), pages 423-446, July.
    8. Adriana Cassoni, 1999. "The wage elasticity of labour demand in the Uruguayan manufacturing sector after re-unionisation: new results," Documentos de Trabajo (working papers) 1499, Department of Economics - dECON.
    9. Carlos Arango & Angela Milena Rojas, 2003. "Demanda Laboral Y Reforma Comercial En El Sector Manufacturero Colombiano: 1977 - 1999," ENSAYOS SOBRE POLÍTICA ECONÓMICA, BANCO DE LA REPÚBLICA - ESPE, December.
    10. Jairo Guillermo Isaza Castro & Carlos Arturo Meza Carvajalino, 2004. "La demanda de trabajo:Aspectos teóricos y evidencia empírica para Colombia," SERIE DE DOCUMENTOS EN ECONOMÍA Y VIOLENCIA 002965, CENTRO DE INVESTIGACIONES EN VIOLENCIA, INSTITUCIONES Y DESARROLLO ECONÓMICO (VIDE).
    11. Giuseppe Bertola, 2005. "Distribution, Efficiency, and Labor Market Regulation: in Theory, in OECD Countries, and in Latin America," Central Banking, Analysis, and Economic Policies Book Series,in: Jorge Restrepo & Andrea Tokman R. & Norman Loayza (Series Editor) & Klaus Schmidt-Hebbel (Series Edi (ed.), Labor Markets and Institutions, edition 1, volume 8, chapter 2, pages 017-060 Central Bank of Chile.
    12. repec:col:000442:015650 is not listed on IDEAS
    13. Maribel Castillo Caicedo & Geovanny Castro Aristizabal & Diana Marcela Escandón Barbosa, 2010. "Demanda laboral de profesionales en ciencias económicas, administrativas e ingeniería en Cali 2009: ¿van de la mano el capital humano y la señalización?," Investigaciones de Economía de la Educación volume 5,in: María Jesús Mancebón-Torrubia & Domingo P. Ximénez-de-Embún & José María Gómez-Sancho & Gregorio Gim (ed.), Investigaciones de Economía de la Educación 5, edition 1, volume 5, chapter 42, pages 825-846 Asociación de Economía de la Educación.
    14. Freeman, Richard B., 2010. "Labor Regulations, Unions, and Social Protection in Developing Countries," Handbook of Development Economics, Elsevier.
    15. Fernando Rios-Avila, 2017. "Unions and Economic Performance in Developing Countries: Case Studies from Latin America," REVISTA ECOS DE ECONOMÍA, UNIVERSIDAD EAFIT, vol. 21(44), pages 4-36, June.
    16. Adriana Cassoni & Gaston J. Labadie & Gabriela Fachola, 2002. "The Economic Effects of Unions in Latin America: Their Impact on Wages and the Economic Performance of Firms in Uruguay," Research Department Publications 3159, Inter-American Development Bank, Research Department.
    17. Jaime Saavedra-Chanduví & Máximo Torero, 2002. "Union Density Changes and Union Effects on Firm Performance in Peru," IDB Publications (Working Papers) 3282, Inter-American Development Bank.
    18. Mauricio Zunino, 2012. "Impactos de la reinstauración de los Consejos de Salarios sobre la distribución salarial en Uruguay," Económica, Departamento de Economía, Facultad de Ciencias Económicas, Universidad Nacional de La Plata, vol. 0, pages 129-167, January-D.
    19. Ben Salha, Ousama, 2013. "Does economic globalization affect the level and volatility of labor demand by skill? New insights from the Tunisian manufacturing industries," Economic Systems, Elsevier, vol. 37(4), pages 572-597.
    20. Daniel S. Hamermesh, 2004. "Labor Demand in Latin America and the Caribbean. What Does It Tell Us?," NBER Chapters,in: Law and Employment: Lessons from Latin America and the Caribbean, pages 553-562 National Bureau of Economic Research, Inc.

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