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Norm-Based Trade Union Membership: Evidence for Germany

  • Goerke, Laszlo

    ()

    (IAAEU, University of Trier)

  • Pannenberg, Markus

    ()

    (Bielefeld University of Applied Sciences)

In the absence of closed-shops and discriminatory wage policies, union membership can be explained by the existence of social norms. We describe a model, incorporating institutional features of the German labour market, which explicitly allows for social custom effects in the determination of union membership. Using panel data for Germany, we find evidence for according effects which restrict freeriding. The impact of social norms tends to increase with net union density. Hence, observed reductions in the demand for union membership can weaken the impact of a norm and accentuate the free-rider problem.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 962.

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Length: 29 pages
Date of creation: Dec 2003
Date of revision:
Publication status: published in: German Economic Review, 2004, 5(4), 481-504
Handle: RePEc:iza:izadps:dp962
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