Wage Setting in Democratic Labour Unions

T. Filges

Working Papers from Centre for Labour Market and Social Research, Danmark-

Abstract: In this paper, we analyse the wage setting of a democratic labour union. The union members differ with respect to their employment probabilities. The union wage only changes if the parameters of the median member change. An exogenous shock to revenue may increase the wage, even if labour demand is iso-elastic and unemployment benefits may have only a small effect on wages if the median member differs from the average. These findings are in accordance with empirical results.

Keywords: UTILITY; EMPLOYMENT; WORKERS' REPRESENTATION (search for similar items in EconPapers)
JEL-codes: E2 J2 J6 (search for similar items in EconPapers)
Pages: 15 pages
Date: 1999
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Persistent link: https://EconPapers.repec.org/RePEc:fth:clmsre:99-08

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