EconPapers    
Economics at your fingertips  
 

Seniority Rules and the Gains from Union Organization

Joseph Tracy ()

No 2039, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: This paper examines the optimality of several seniority provisions which are common to U.S. union contracts. The paper focuses on the attempts by the initial union members to maximize their return from organizing the union. An overlapping generations model is used in the analysis. Seniority wage increases are found to serve as implicit initiation fees and thus serve as one means of appropriating rents from future union members. Layoff rules are shown to be optimal only when the organizers are constrained in the types of contracts they can write. Without these constraints, the optimal contract provides full insurance making layoff rules unnecessary. The paper concludes with a plausible set of constraints which organizers may face and discusses the conditions necessary for seniority layoff rules to result.

Date: 1986-10
Note: LS
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2) Track citations by RSS feed

Downloads: (external link)
http://www.nber.org/papers/w2039.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nbr:nberwo:2039

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w2039

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().

 
Page updated 2019-10-23
Handle: RePEc:nbr:nberwo:2039