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Individually-Relational Union Membership

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  • Bulkley, G.
  • Myles, G.D.

Abstract

The analysis of the determination of union membership has typically met difficulties with the fact that union membership is not individually rational and free-riding is the dominant strategy. We assume that workers differ in their reservation wages and hence in their preferred choice of contract, so preventing free-riding on the contract choice of others. This implies that joining a union is equivalent to buying a vote on the contract and provides an individual incentive to join the union. An equilibrium trade union membership is characterized in which membership is taken up by those with relatively "extreme" tastes. The union achieves a centralist objective even though no member precisely supports such a view.

Suggested Citation

  • Bulkley, G. & Myles, G.D., 2000. "Individually-Relational Union Membership," Discussion Papers 0008, University of Exeter, Department of Economics.
    • Handle: RePEc:exe:wpaper:0008
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    References listed on IDEAS

    as
    1. Bulkley, George & Myles, Gareth D & Pearson, Bernard R, 2001. "On the Membership of Decision-Making Committees," Public Choice, Springer, vol. 106(1-2), pages 1-22, January.
    2. repec:exe:wpaper:00/09 is not listed on IDEAS
    3. Vannetelbosch, Vincent J., 1997. "Wage bargaining with incomplete information in an unionized Cournot oligopoly," European Journal of Political Economy, Elsevier, vol. 13(2), pages 353-374, May.
    4. Bulkley, George & Myles, Gareth D., 1997. "Bargaining over effort," European Journal of Political Economy, Elsevier, vol. 13(2), pages 375-384, May.
    5. Robin Naylor, 1989. "Strikes, Free Riders, and Social Customs," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 104(4), pages 771-785.
    6. Naylor, Robin & Cripps, Martin, 1993. "An economic theory of the open shop trade union," European Economic Review, Elsevier, vol. 37(8), pages 1599-1620, December.
    7. Alison L. Booth, 1985. "The Free Rider Problem and a Social Custom Model of Trade Union Membership," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 100(1), pages 253-261.
    8. Moreton, David R., 1998. "An open shop trade union model of wages, effort and membership," European Journal of Political Economy, Elsevier, vol. 14(3), pages 511-527, August.
    9. Myles, Gareth D. & Naylor, Robin A., 1995. "Do unions reduce discrimination? A model of Nash bargaining between a union and an employer with discriminatory tastes," Labour Economics, Elsevier, vol. 2(3), pages 249-274, September.
    10. George J. Stigler, 1974. "Free Riders and Collective Action: An Appendix to Theories of Economic Regulation," Bell Journal of Economics, The RAND Corporation, vol. 5(2), pages 359-365, Autumn.
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    Cited by:

    1. Falch, Torberg & Strom, Bjarne, 2007. "Wage bargaining and monopsony," Economics Letters, Elsevier, vol. 94(2), pages 202-207, February.
    2. Francesco De Sinopoli & Giovanna Iannantuoni, 2005. "Meetings with Costly Participation: Comment," American Economic Review, American Economic Association, vol. 95(4), pages 1349-1350, September.
    3. Schnabel, Claus & Wagner, Joachim, 2003. "Trade union membership in Eastern and Western Germany: convergence or divergence?," Discussion Papers 18, Friedrich-Alexander University Erlangen-Nuremberg, Chair of Labour and Regional Economics.
    4. Rupayan PAL, 2010. "Impact Of Communist Parties On The Individual Decision To Join A Trade Union: Evidence From India," The Developing Economies, Institute of Developing Economies, vol. 48(4), pages 496-528, December.
    5. Schnabel, Claus & Wagner, Joachim, 2005. "Determinants of Union Membership in 18 EU Countries : Evidence from Micro Data, 2002/03," Discussion Papers 31, Friedrich-Alexander University Erlangen-Nuremberg, Chair of Labour and Regional Economics.
    6. Rupayan Pal, 2008. "Estimating the Probability of Trade Union Membership in India: Impact of Communist Parties, Personal Attributes and Industrial Characteristics," Working Papers id:1669, eSocialSciences.
    7. Gábor R., István, 2004. "Tőkésvállalat vis-à-vis szakszervezet, versus termelőszövetkezet. Peripatetikus tanmese az intézményi racionalitás/diverzitás és a piaci önszabályozás ellentmondásos viszonyáról [Capitalist firm ve," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(7), pages 740-751.
    8. Schnabel, Claus, 2002. "Determinants of trade union membership," Discussion Papers 15, Friedrich-Alexander University Erlangen-Nuremberg, Chair of Labour and Regional Economics.
    9. Schnabel, Claus & Wagner, Joachim, 2003. "Determinants of Trade Union Membership in Western Germany: Evidence from Micro Data, 1980-2000," IZA Discussion Papers 708, Institute of Labor Economics (IZA).

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    More about this item

    Keywords

    WORKERS ; WAGES ; CONTRACTS;
    All these keywords.

    JEL classification:

    • D7 - Microeconomics - - Analysis of Collective Decision-Making
    • J5 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining

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