Abstract

This paper develops a model of trade union behaviour which serves to explain the determination of adult and youth rates of pay and employment. In the model, unions attempt to protect the employment interests of their adult members by raising the levels of youth pay in order to reduce the scope for youth-adult labour substitution. The comparative static properties of the model are deduced and it is argued that the model is capable of shedding light on recent experiences of youths and adults in the U.K. labour market and on the possible outcomes of different forms of young worker schemes.

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