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Union membership and the erosion of the Ghent system: Lessons from Finland

  • Petri Böckerman

    (Labour Institute for Economic Research)

  • Roope Uusitalo

    (Labour Institute for Economic Research)

Union density declined in Finland by more than 10 percentage points in less than ten years. This paper analyses the reasons behind the decline, using micro data from the 1990s. According to our results, the changes in the composition of the labour force and the changes in the labour market explain about a quarter of this decline. The main reason for the decline appears to be the erosion of the Ghent system, due to the emergence of an independent UI fund that provides unemployment insurance without requiring union membership. Interestingly, we find evidence that the decline in the union density can be attributed to declining inclination of the cohorts born after the early 1960s to become union members.

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File URL: http://128.118.178.162/eps/lab/papers/0508/0508008.pdf
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Paper provided by EconWPA in its series Labor and Demography with number 0508008.

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Length: 32 pages
Date of creation: 11 Aug 2005
Date of revision:
Handle: RePEc:wpa:wuwpla:0508008
Note: Type of Document - pdf; pages: 32
Contact details of provider: Web page: http://128.118.178.162

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  1. Alex Bryson & Rafael Gomez, 2005. "Why Have Workers Stopped Joining Unions? The Rise in Never-Membership in Britain," British Journal of Industrial Relations, London School of Economics, vol. 43(1), pages 67-92, 03.
  2. Nickell, S. & Layard, R., 1997. "Labour Market Institutions and Economic Performance," Papers 23, Centre for Economic Performance & Institute of Economics.
  3. Jaakko Pehkonen & Hannu Tanninen, 1997. "Institutions, Incentives and Trade Union Membership," LABOUR, CEIS, vol. 11(3), pages 579-598, November.
  4. Hagen Lesch, 2004. "Trade Union Density in International Comparison," CESifo Forum, Ifo Institute for Economic Research at the University of Munich, vol. 5(4), pages 12-18, December.
  5. David G. Blanchflower & Richard B. Freeman, 1993. "Did the Thatcher Reforms Change British Labour Performance?," NBER Working Papers 4384, National Bureau of Economic Research, Inc.
  6. Daniele Checchi & Claudio Lucifora, 2002. "Unions and labour market institutions in Europe," Departmental Working Papers 2002-16, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
  7. Holmlund, Bertil & Lundborg, Per, 1996. "Wage Bargaining, Union Membership, and the Organization of Unemployment Insurance," Working Paper Series 1996:17, Uppsala University, Department of Economics.
  8. Hakola, Tuulia & Uusitalo, Roope, 2005. "Not so voluntary retirement decisions? Evidence from a pension reform," Journal of Public Economics, Elsevier, vol. 89(11-12), pages 2121-2136, December.
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