The Single-Mindedness of Labor Unions: Theory and Empirical Evidence

Emanuele Canegrati

MPRA Paper from University Library of Munich, Germany

Abstract: In this paper I analyse a labour market where the wage is endogenously determined according to an Efficient Bargaining process between a firm and a labour union whose members are partitioned into two social groups: the old and the young. Furthermore, I exploit the Single-Mindedness theory, which considers the existence of a density function which endogenously depends on leisure. I demonstrate that, when preferences of one group for leisure are higher than those of the other group the latter suffers from higher tax rates and with lower level of wage rates and lower levels of leisure. Finally, since the former is more single-minded, it may exploit its greater political power in order to get a positive intergenerational transfer. Empirical evidence from the WERS 2004 survey confirms main results of the model.

Keywords: bargaining models; labour unions; political economy; single-mindedness (search for similar items in EconPapers)
JEL-codes: D71 J20 J21 J22 J26 J38 J50 J51 J52 J58 (search for similar items in EconPapers)
Date: 2007-01
New Economics Papers: this item is included in nep-pol
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:1398

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