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Insurance in a Unionized Labour Market: An Empirical Test

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  • Felice Martinello

Abstract

The hypothesis that employers insure their workers against unfavorable states is tested against the alternative hypothe sis that efficient but noninsuring contracts occur. Data on the Briti sh Columbian pulp and paper industry (January 1977 to April 1985) are used. The comparative statics predictions of the implicit contract m odel are also derived and tested against the data. When manhours is u sed to represent employment, the hypothesis of insurance cannot be re jected and the data generally support the predictions of the implicit contract model. When number of men is used to represent employment, the data are not as supportive of the model and the hypothesis that l abor is insured against movements in consumer prices can be rejected at high significance levels.

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  • Felice Martinello, 1988. "Insurance in a Unionized Labour Market: An Empirical Test," Canadian Journal of Economics, Canadian Economics Association, vol. 21(2), pages 394-409, May.
    • Handle: RePEc:cje:issued:v:21:y:1988:i:2:p:394-409
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    Cited by:

    1. Haupt, Stefan, 1998. "Testing incentives for illegal employment: Implicit contracts vs trade union bargaining," HWWA Discussion Papers 51, Hamburg Institute of International Economics (HWWA).
    2. Haupt, Stefan, 1998. "Testing Incentives for Illegal Employment: Implicit Contracts vs Trade Union Bargaining," Discussion Paper Series 26209, Hamburg Institute of International Economics.

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