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Wage Bargaining, Union Membership, and the Organization of Unemployment Insurance

Bertil Holmlund and Per Lundborg

No 1996:17, Working Paper Series from Uppsala University, Department of Economics

Abstract: The paper offers a theoretical analysis of a labor market institution known as the Gent system, which is a system where unions run unemployment insurance (UI) through government-subsidized UI funds. This sytem is practiced in four Nordic countries with comparatively very high unionization rates. The analysis shows that the Gent system is more conducive to unionization than a compulsory UI system if the Gent system is heavily subsidized by the government or if workers are strongly risk averse. Moreover, a rise in the share of benefits financed by union members is likely to reduce wages as well as union membership.

Keywords: wage bargaining; union membership; unemployment insurance (search for similar items in EconPapers)
JEL-codes: J50 J65 J68 (search for similar items in EconPapers)
Pages: 36 pages
Date: 1996-09-15
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Citations: View citations in EconPapers (8) Track citations by RSS feed

Published in Labour Economics, 1999, pages 397-415.

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