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Do trade unions care about employment?: reduced-form test results from the Finnish paper and textile industries

Jaakko Pehkonen
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Jaakko Pehkonen: University of Jyväskylä

Finnish Economic Papers, 1990, vol. 3, issue 1, 26-40

Abstract: This study reports the results of testing the seniority model of trade union behaviour using data on two Finnish industries. We found that; (i) the empirical results do not support the idea that the aim of trade unions is merely to push their members' wages as high as possible; (ii) the relationship between the real consumption wage and aggregate unemployment is non-linear in such a way that the unemployment elasticity of the real consumption wage rises in absolute terms with the unemployment rate; and (iii) the unemployment elasticity of the real consumption wage differs significantly across the industries studied.

Date: 1990
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