A Dynamic Model of Union Behaviour. The Role of an Endogenous Outside Option and Bargaining Centralisation
We analyse the role of bargaining centralisation when both the union's outside option and union membership are endogenous and considered in a dynamic framework. A dynamic two-sector model is developed where the wage rate in the first sector is either set by a monopoly union or is the result of efficient bargaining between union and firm. The union's outside option is employment in the second, competitive sector. We extend the dynamic analysis by modelling the outside option as endogenous and show that dynamic models may also overstate employment distortions in this case if bargaining is conducted on a highly centralised stage. Additionally, we offer reflexions along the optimisation process in different scenarios and a comparative static analysis, thus presenting some new general insights into the topic.
|Date of creation:||2006|
|Date of revision:|
|Contact details of provider:|| Postal: 01062 Dresden|
Phone: ++49 351 463 2196
Fax: ++49 351 463 7739
Web page: https://tu-dresden.de/gsw/wirtschaft/
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Blackorby, Charles & Bossert, Walter & Donaldson, David, 1995. "Intertemporal Population Ethics: Critical-Level Utilitarian Principles," Econometrica, Econometric Society, vol. 63(6), pages 1303-20, November.
- Jones, Stephen R. G., 1987. "Union membership and employment dynamics," Economics Letters, Elsevier, vol. 25(2), pages 197-200.
- Jones, Stephen R G & McKenna, C J, 1994. "A Dynamic Model of Union Membership and Employment," Economica, London School of Economics and Political Science, vol. 61(242), pages 179-89, May.
- SVEJNAR, Jan, .
"Bargaining power, fear of disagreement, and wage settlements: theory and evidence from U.S. industry,"
CORE Discussion Papers RP
720, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Svejnar, Jan, 1986. "Bargaining Power, Fear of Disagreement, and Wage Settlements: Theory and Evidence from U.S. Industry," Econometrica, Econometric Society, vol. 54(5), pages 1055-78, September.
- Svejnar, J., 1984. "Bargaining power, fear of disagreement and wage settlements: theory and evidence from U.S. industry," CORE Discussion Papers 1984037, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Marcus Dittrich, 2008. "Union wage setting in a dual labour market: the role of centralisation," International Economic Journal, Taylor & Francis Journals, vol. 22(4), pages 461-470.
- Kidd, David P & Oswald, Andrew J, 1987. "A Dynamic Model of Trade Union Behaviour," Economica, London School of Economics and Political Science, vol. 54(215), pages 355-65, August.
- Fuest, Clemens & Thum, Marcel, 2001.
"Immigration and skill formation in unionised labour markets,"
European Journal of Political Economy,
Elsevier, vol. 17(3), pages 557-573, September.
- Clemens Fuest & Marcel Thum, 1999. "Immigration and Skill Formation in Unionised Labour Markets," CESifo Working Paper Series 214, CESifo Group Munich.
- Thomas Beissinger & Hartmut Egger, 2004.
"Dynamic wage bargaining if benefits are tied to individual wages,"
Oxford Economic Papers,
Oxford University Press, vol. 56(3), pages 437-460, July.
- Beissinger, Thomas & Egger, Hartmut, 2001. "Dynamic Wage Bargaining if Benefits are Tied to Individual Wages," IZA Discussion Papers 389, Institute for the Study of Labor (IZA).
- Ian M. McDonald & Robert M. Solow, 1985. "Wages and Employment in a Segmented Labor Market," The Quarterly Journal of Economics, Oxford University Press, vol. 100(4), pages 1115-1141.
- Chang, Juin-jen & Lai, Ching-chong, 1997. "Union membership and employment dynamics with endogenous union density," Economics Letters, Elsevier, vol. 57(1), pages 119-125, November.
- McDonald, Ian M & Solow, Robert M, 1981. "Wage Bargaining and Employment," American Economic Review, American Economic Association, vol. 71(5), pages 896-908, December.
- Chang, Juin-jen & Lai, Ching-chong & Chang, Wen-ya, 1998. "A Dynamic Model of Union Membership and Employment: A Comment," Economica, London School of Economics and Political Science, vol. 65(257), pages 145-51, February.
When requesting a correction, please mention this item's handle: RePEc:zbw:tuddps:0706. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (ZBW - German National Library of Economics)
If references are entirely missing, you can add them using this form.