Why Unions Survive: Understanding How Unions Overcome The Free-Rider Problem

Richard Murphy

No 25924, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: This paper provides evidence for why individuals join unions instead of free-riding. I model membership as legal insurance. To test the model, I use the incidence of news stories concerning allegations against teachers in the UK as a plausibly exogenous shock to demand for such insurance. I find that, for every five stories occurring in a region, teachers are 2.2 percentage points more likely to be members in the subsequent year. These effects are larger when teachers share characteristics with the news story and can explain 45 percent of the growth in teacher union membership between 1992 and 2010.

JEL-codes: I20 J45 J51 (search for similar items in EconPapers)
Date: 2019-06
New Economics Papers: this item is included in nep-ias and nep-lma
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Published as Richard Murphy, 2020. "Why Unions Survive: Understanding How Unions Overcome the Free-Rider Problem," Journal of Labor Economics, vol 38(4), pages 1141-1188.

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Working Paper: Why unions survive: understanding how unions overcome the free-rider problem (2019)
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