IDEAS home Printed from https://ideas.repec.org/p/wpa/wuwpla/0402002.html

Redistributing through Unions

Author

Listed:
  • Federico Boffa

    (Northwestern University)

Abstract

The paper proposes a theoretical framework to analyze the contribution of the trade unions in the compensation schemes. The tendencies, observed in unionized sectors, towards compression of wages and towards an earning profile increasing with seniority are set into an equilibrium model. The driving force leading the unions to pursue the aforementioned wage structure is examined, and the three hypotheses of union benevolent with respect to all workers, benevolent with respect to its members, and ruled by the median worker are tested in various contexts that differ according to the outside option that the workers face. Some implications are then derived, regarding the redistribution operated by the union within a cohort and in favor of senior workers, and the effects of unions on productive efficiency and unemployment level I am indebted to prof. Taber for his support and his guidance, prof. Meyer and prof. Mortensen for valuable comments, and Fabio Braggion, David Lucca, Jakub Kastl, Salvatore Piccolo and Razvan Vlaicu for advices and suggestions. .

Suggested Citation

  • Federico Boffa, 2004. "Redistributing through Unions," Labor and Demography 0402002, University Library of Munich, Germany.
    • Handle: RePEc:wpa:wuwpla:0402002
    Note: Type of Document - pdf; prepared on windowsXP; pages: 25
    as

    Download full text from publisher

    File URL: https://econwpa.ub.uni-muenchen.de/econ-wp/lab/papers/0402/0402002.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Hibbs, Douglas A, Jr & Locking, Hakan, 2000. "Wage Dispersion and Productive Efficiency: Evidence for Sweden," Journal of Labor Economics, University of Chicago Press, vol. 18(4), pages 755-782, October.
    2. Farber, Henry S, 1978. "Individual Preferences and Union Wage Determination: The Case of the United Mine Workers," Journal of Political Economy, University of Chicago Press, vol. 86(5), pages 923-942, October.
    3. David Austen-Smith & Michael Wallerstein, 2003. "Redistribution in a Divided Society," Discussion Papers 1362, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
    4. Peter A. Diamond & J. A. Mirrlees, 1968. "Optimal Taxation and Public Production," Working papers 22, Massachusetts Institute of Technology (MIT), Department of Economics.
    5. Richard B. Freeman, 1980. "Unionism and the Dispersion of Wages," ILR Review, Cornell University, ILR School, vol. 34(1), pages 3-23, October.
    6. Agell, J. & Lommerud, K.E., 1990. "Union Egalitarianism As Income Insurance," Papers 1990a, Uppsala - Working Paper Series.
    7. Emmanuel Saez, 2002. "Optimal Income Transfer Programs: Intensive versus Extensive Labor Supply Responses," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 117(3), pages 1039-1073.
    8. Samuelson, P. A., 1986. "Theory of optimal taxation," Journal of Public Economics, Elsevier, vol. 30(2), pages 137-143, July.
    9. Oswald, Andrew J, 1982. "The Microeconomic Theory of the Trade Union," Economic Journal, Royal Economic Society, vol. 92(367), pages 576-595, September.
    10. John H. Pencavel, 1984. "The Tradeoff Between Wages and Employment in Trade Union Objectives," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 99(2), pages 215-231.
    11. Freeman, Richard B & Kleiner, Morris M, 1990. "The Impact of New Unionization on Wages and Working Conditions," Journal of Labor Economics, University of Chicago Press, vol. 8(1), pages 8-25, January.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. repec:eee:labchp:v:2:y:1986:i:c:p:1039-1089 is not listed on IDEAS
    2. Jeffrey S. Zax, 1985. "Municipal Employment, Municipal Unions, and Demand for Municipal Services," NBER Working Papers 1728, National Bureau of Economic Research, Inc.
    3. Henry S. Farber, 1984. "The Analysis of Union Behavior," NBER Working Papers 1502, National Bureau of Economic Research, Inc.
    4. repec:pri:indrel:dsp01cc08hf62w is not listed on IDEAS
    5. Nicholas Lawson, 2011. "Is Collective Bargaining Pareto Efficient? A Survey of the Literature," Journal of Labor Research, Springer, vol. 32(3), pages 282-304, September.
    6. Ester Faia & Lorenza Rossi, 2013. "Union Power, Collective Bargaining, And Optimal Monetary Policy," Economic Inquiry, Western Economic Association International, vol. 51(1), pages 408-427, January.
    7. Habib Ahmed & Stephen M. Miller, 1999. "A Model of Endogenous Union Density and Membership," Working papers 1999-01, University of Connecticut, Department of Economics.
    8. Christian M. Dahl & Daniel le Maire & Jakob R. Munch, 2013. "Wage Dispersion and Decentralization of Wage Bargaining," Journal of Labor Economics, University of Chicago Press, vol. 31(3), pages 501-533.
    9. Gene M. Grossman, 1984. "International Competition and the Unionized Sector," Canadian Journal of Economics, Canadian Economics Association, vol. 17(3), pages 541-556, August.
    10. Cardoso, Ana Rute & Portugal, Pedro, 2003. "Bargained Wages, Wage Drift and the Design of the Wage Setting System," IZA Discussion Papers 914, Institute of Labor Economics (IZA).
    11. David G. Blanchflower & Andrew J. Oswald, 1995. "The Wage Curve," MIT Press Books, The MIT Press, edition 1, volume 1, number 026202375x, December.
    12. Fanti, Luciano & Gori, Luca, 2013. "Efficient bargaining versus right to manage: A stability analysis in a Cournot duopoly with trade unions," Economic Modelling, Elsevier, vol. 30(C), pages 205-211.
    13. Bustos, Emil, 2024. "Collectively Bargained Wages and Female Earnings: Evidence from Swedish Local Governments," Working Paper Series 1494, Research Institute of Industrial Economics.
    14. Mulder, C.B., 1987. "Inefficiency of automatically linking unemployment benefits to private sector wage rates," Other publications TiSEM 0ed0d42c-6fc5-4885-a8de-2, Tilburg University, School of Economics and Management.
    15. Johan Stennek, 2020. "Why Unions Reduce Wage Inequality: A Theory of Domino Effects," Scandinavian Journal of Economics, Wiley Blackwell, vol. 122(3), pages 1045-1072, July.
    16. Andreas Irmen & Berthold U. Wigger, 2002. "Trade Union Objectives and Economic Growth," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 59(1), pages 49-67, February.
    17. Mattesini, Fabrizio & Rossi, Lorenza, 2009. "Optimal monetary policy in economies with dual labor markets," Journal of Economic Dynamics and Control, Elsevier, vol. 33(7), pages 1469-1489, July.
    18. Lee, David & Saez, Emmanuel, 2012. "Optimal minimum wage policy in competitive labor markets," Journal of Public Economics, Elsevier, vol. 96(9-10), pages 739-749.
    19. Albert Jan Hummel & Bas Jacobs, 2018. "Optimal Income Taxation in Unionized Labor Markets," Tinbergen Institute Discussion Papers 18-064/VI, Tinbergen Institute.
    20. Claudio Agostini, 2004. "Tax Interdependence in American States," Econometric Society 2004 Latin American Meetings 155, Econometric Society.
    21. Addessi, William & Busato, Francesco, 2009. "Fair wages, labor relations and asset returns," Journal of Financial Stability, Elsevier, vol. 5(4), pages 410-430, December.
    22. Besancenot, Damien & Vranceanu, Radu, 1999. "A trade union model with endogenous militancy: interpreting the French case," Labour Economics, Elsevier, vol. 6(3), pages 355-373, September.

    More about this item

    Keywords

    ;

    JEL classification:

    • J - Labor and Demographic Economics
    • J - Labor and Demographic Economics

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wpa:wuwpla:0402002. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: EconWPA The email address of this maintainer does not seem to be valid anymore. Please ask EconWPA to update the entry or send us the correct address (email available below). General contact details of provider: https://econwpa.ub.uni-muenchen.de .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.