Deunionization and job polarization – a macroeconomic model analysis for a small open economy
Thomas von Brasch,
Marit Linnea Gjelsvik and
Economic Systems Research, 2018, vol. 30, issue 3, 380-399
Declining unionization rates and job polarization are two important labor market developments of recent decades. A large body of literature has analyzed these phenomena separately, but little has been done to see whether there is a link between them. We employ a macroeconomic model for a small open economy with a large input–output core to analyze how deunionization may cause job polarization. Our analysis shows that medium-skilled workers are negatively affected by deunionization, mainly as a result of the heterogeneity of the elasticities of substitution between different types of labor. While the elasticities of substitution between high- and medium-skilled labor are relatively low, the elasticities of substitution between medium- and low-skilled are relatively high. As a result, when deunionization leads to increased wage dispersion, we find that demand for low-skilled increases at the expense of medium-skilled labor, thus yielding a more polarized labor market.
References: View references in EconPapers View complete reference list from CitEc
Citations Track citations by RSS feed
Downloads: (external link)
Access to full text is restricted to subscribers.
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:taf:ecsysr:v:30:y:2018:i:3:p:380-399
Ordering information: This journal article can be ordered from
Access Statistics for this article
Economic Systems Research is currently edited by Bart Los and Manfred Lenzen
More articles in Economic Systems Research from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().