IDEAS home Printed from https://ideas.repec.org/p/wpa/wuwpla/0402002.html
   My bibliography  Save this paper

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. 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.
    3. Richard B. Freeman, 1980. "Unionism and the Dispersion of Wages," ILR Review, Cornell University, ILR School, vol. 34(1), pages 3-23, October.
    4. 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.
    5. 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.
    6. 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.
    7. Peter A. Diamond & J. A. Mirrlees, 1968. "Optimal Taxation and Public Production," Working papers 22, Massachusetts Institute of Technology (MIT), Department of Economics.
    8. Agell, J. & Lommerud, K.E., 1990. "Union Egalitarianism As Income Insurance," Papers 1990a, Uppsala - Working Paper Series.
    9. Samuelson, P. A., 1986. "Theory of optimal taxation," Journal of Public Economics, Elsevier, vol. 30(2), pages 137-143, July.
    10. Oswald, Andrew J, 1982. "The Microeconomic Theory of the Trade Union," Economic Journal, Royal Economic Society, vol. 92(367), pages 576-595, September.
    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. Gene M. Grossman, 1984. "International Competition and the Unionized Sector," Canadian Journal of Economics, Canadian Economics Association, vol. 17(3), pages 541-556, August.
    3. 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.
    4. 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.
    5. David G. Blanchflower & Andrew J. Oswald, 1995. "The Wage Curve," MIT Press Books, The MIT Press, edition 1, volume 1, number 026202375x, December.
    6. 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.
    7. 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).
    8. Jeffrey S. Zax, 1985. "Municipal Employment, Municipal Unions, and Demand for Municipal Services," NBER Working Papers 1728, National Bureau of Economic Research, Inc.
    9. Henry S. Farber, 1984. "The Analysis of Union Behavior," NBER Working Papers 1502, National Bureau of Economic Research, Inc.
    10. repec:pri:indrel:dsp01cc08hf62w is not listed on IDEAS
    11. Habib Ahmed & Stephen M. Miller, 1999. "A Model of Endogenous Union Density and Membership," Working papers 1999-01, University of Connecticut, Department of Economics.
    12. Fanti, Luciano, 2013. "Cross-ownership and unions in a Cournot duopoly: When profits reduce with horizontal product differentiation," Japan and the World Economy, Elsevier, vol. 27(C), pages 34-40.
    13. Therry Lallemand & François Rycx, 2006. "Establishment Size and the Dipsersion of Wages: Evidence from european Countries," Applied Economics Quarterly (formerly: Konjunkturpolitik), Duncker & Humblot, Berlin, vol. 52(4), pages 309-336.
    14. 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.
    15. 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.
    16. Almas Heshmati & Ilham Haouas, 2004. "The effects of union wage-settings on firms' production factor decisions," Applied Economics Letters, Taylor & Francis Journals, vol. 11(7), pages 415-420.
    17. Wolfram Richter & Kerstin Schneider, 2001. "Taxing Mobile Capital with Labor Market Imperfections," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 8(3), pages 245-262, May.
    18. Bridgman, Benjamin, 2015. "Competition, work rules and productivity," Journal of Economic Dynamics and Control, Elsevier, vol. 52(C), pages 136-149.
    19. Hummel, Albert Jan & Jacobs, Bas, 2023. "Optimal income taxation in unionized labor markets," Journal of Public Economics, Elsevier, vol. 220(C).
    20. Richard B. Freeman & Morris M. Kleiner, 1999. "Do Unions Make Enterprises Insolvent?," ILR Review, Cornell University, ILR School, vol. 52(4), pages 510-527, July.
    21. David S. Lee & Alexandre Mas, 2012. "Long-Run Impacts of Unions on Firms: New Evidence from Financial Markets, 1961--1999," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 127(1), pages 333-378.
    22. Mulder, C B, 1993. "Wage-Moderating Effects of Corporatism: Decentralized versus Centralized Wage Setting in a Union, Firm, Government Context," The Manchester School of Economic & Social Studies, University of Manchester, vol. 61(3), pages 287-301, 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.