Union Wages, Hours of Work and the Effectiveness of Partial Coordination Agreements

Sven Wehke

No 7019, FEMM Working Papers from Otto-von-Guericke University Magdeburg, Faculty of Economics and Management

Abstract: Small monopoly trade unions decide upon the wage rate per hour and the hours of work subject to firm's demand for union members. Since the resulting Nash equilibrium is characterized by excess unemployment, we study the employment and welfare effects when trade unions try to coordinate their policies. Firstly, we consider a joint agreement about marginal wage moderation, where trade unions remain free to choose the hours of work non-cooperatively. Secondly, we analyze in which way a joint change in the hours of work affects employment and welfare if trade unions are free to choose the wage rate.

Keywords: unemployment; wage setting; hours of work; partial cooperation (search for similar items in EconPapers)
JEL-codes: C72 J51 (search for similar items in EconPapers)
Pages: 28 pages
Date: 2007-09
New Economics Papers: this item is included in nep-bec, nep-gth and nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Journal Article: Union wages, hours of work and the effectiveness of partial coordination agreements (2009)
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