Union Preferences Research Articles

The effects of entry in bilateral oligopoly

We show that a firm’s profits under Cournot oligopoly can be increasing in the number of firms in the industry if wages are determined by (decentralised) bargaining in unionised bilateral oligopoly. The intuition for the result is that increased product market competition following an increase in the number of firms is mirrored by increased labour market rivalry which induces (profit-enhancing) wage moderation, a result which does not occur if unions can coordinate their wage demands under centralised bargaining. Whether the product or labour market effect dominates depends on the nature of union preferences, with a higher preference for wages making profit-raising entry more likely. We analyse how our results are sensitive to the curvature of the demand function, and the extent to which structural advantages due to incumbency enhance the benefits of entry. We also consider: (i) the impact of entry on a measure of social welfare comprising union utility, consumer surplus and firms’ profits, and (ii) a setting in which unionisation is determined endogenously through the decision of firms on whether or not to recognise unions.

Unions, collective agreements and productivity: A firm‐level analysis using Norwegian matched employer–employee panel data

AbstractWhat is the role of collective agreements in explaining how unions affect firm‐level productivity? Using matched employer–employee panel data for the Norwegian labour market, comprising almost 21 million individual‐year observations in the period 2002–2018, we find that the presence of a collective agreement in a firm is associated with higher productivity. Without a collective agreement, higher union density is estimated to reduce productivity. However, if a collective agreement is implemented in the firm, not only is the estimated negative effect reduced—in some cases it becomes positive. This result remains significant, numerically and statistically, across several model specifications and different estimation methods. In particular, we provide a new source of exogenous variation in union memberships by utilizing information on intergenerational transmission of union preferences. Besides regulating terms and conditions for wage formation and working hours, collective agreements have a profound impact on how firms organize and formally recognize the voice of workers. In this regard, our finding supports the conclusion of Freeman and Medoff that the quality of institutional systems is crucial to understand what unions do to productivity.

One union, different futures? Public preferences for the EU's future and their explanations in 10 EU countries

Most studies of public opinion towards the European Union focus on attitudes regarding the past and present of the European Union. This study fills a gap by addressing attitudes towards the European Union's future. We expand on a recently developed approach measuring preferences for eight concrete future European Union scenarios that represent the ongoing political and public debate, employing original survey data collected in 2019 in 10 European Union countries. We assess cross-national differences in the distribution of future European Union preferences, as well as in citizens’ motivations to prefer different variants of Europe in the future. The findings show citizens’ fine-grained future European Union preferences, which are meaningfully related to common explanations of European Union support. We also find cross-national differences linked to countries’ structural position within the European Union.

Surnames and population structure in the Doctrine of Belén, Altos de Arica, Viceroyalty of Peru (1750-1813).

The analysis of multiple population structures (biodemographic, genetic and socio-cultural) and their inter-relations contribute to a deeper understanding of population structure and population dynamics. Genetically, the population structure corresponds to the deviation of random mating conditioned by a limited number of ancestors, by restricted migration in the social or geographic space, or by preference for certain consanguineous unions. Through the isonymic method, surname frequency and distribution across the population can supply quantitative information on the structure of a human population, as they constitute universal socio-cultural variables. Using documentary sources to undertake the Doctrine of Belén's (Altos de Arica, Chile) historical demography reconstruction between 1763 and 1820, this study identified an indigenous population with stable patronymics. The availability of complete marriage, baptism and death records, low rates of migration and the significant percentage of individuals registered and constantly present in this population favoured the application of the isonymic method. The aim of this work was to use given names and surnames recorded in these documentary sources to reconstruct the population structure and migration pattern of the Doctrine of Belén between 1750 and 1813 through the isonymic method. The results of the study were consistent with the ethno-historical data of this ethnic space, where social cohesion was, in multiple ways, related to the regulation of daily life in colonial Andean societies.

Labor unions and bank risk culture: evidence from the financial crisis

In this paper, we examine the effect of labor unions on bank performance during the recent financial crisis. Empirical evidence from the 314 largest global banks indicates that the stock returns and profitability of unionized banks are higher, and the default probabilities are lower than non-unionized banks. Moreover, unionized banks have lower tail risk in their stock returns, more tangible equity, more liquid assets, and better quality lending before the crisis than non-unionized banks. These finding show that unionized banks operate more conservatively and engage in less risk-taking. Our results imply that union preferences can shape the risk culture of banks.

‘Smart’ Industrial Relations in the Making? Insights from Analysis of Union Responses to Digitalization in Italy

How do unions respond to the emerging threats and opportunities posed by digitalization in the sphere of employment relations? What factors account for the focus and varying effectiveness of their responses? This paper seeks to address these questions in the case of Italy—a theoretically interesting case that combines significant digitalization-related challenges, historically strong industrial relations institutions under increasing pressure, and diverse union confederations. From the available evidence, we find that Italian union strategies and demands so far have been primarily focused on interventions at the macro and meso levels, with a view to extending traditional forms of protection—especially sectoral collective bargaining agreements—to deal with the disruptive effects of digitalization. This focus has been coupled with some limited innovation in union agendas and discursive repertoires focused on the micro level of intervention, as well as a shift in union preferences toward inclusion of platform workers and self-employed workers in their constituencies. Whilst highlighting the importance of agential factors, we nonetheless find that the focus and effectiveness of union interventions are crucially shaped by prior institutional legacies and distributions of power resources, as well as by the ideological orientation and strategic capabilities of individual unions themselves. Overall, Italian unions have to date tended to privilege gradual response strategies based on extension and adaptation of existing and established institutions. It remains to be seen whether such adaptive approaches will be sufficient to effectively govern the digital transformation of work or whether more radical institutional experimentation will become necessary. Either way, in order to build smart industrial relations in Italy, unions will have an active role to play.

Union structure, bounded solidarity and support for redistribution: Implications for building a welfare state

This study unveils the effects of union structure – national, industrial and enterprise unionism – on the solidarity and redistribution preferences of workers. We argue that labor unions have varied scope and levels of solidarity as well as redistribution preferences because solidarity is not naturally given but tends to be cultivated by labor unions. In order to sustain commitment to egalitarian wages and redistributive social policies, a spirit of solidarity must be instilled in the minds of members, especially more privileged workers. Our analysis finds that countries with encompassing unions at national and industry levels have higher levels of overall support for government intervention to reduce income inequality than countries with enterprise unionism. It suggests that welfare state building is not just a function of relative power between labor and capital; union structure and preference formation matter as well.

Poor versus rich countries: a gap in public attitudes towards fiscal solidarity in the EU

Existing research has primarily focused on the role of utility and identity in shaping individuals’ European Union (EU) preferences. This article argues that macroeconomic context is a crucial predictor of attitudes towards transnational financial assistance, which has been omitted from previous analyses. Using data from the 2014 European Election Studies (EES) Voter Study for 28 EU member states, this article demonstrates that citizens living in poorer EU countries are less willing to support fiscal solidarity than their counterparts in more affluent countries. Country affluence serves as a heuristic, moderating the relationship between individual-level utility and identity considerations and willingness to show solidarity to member states with economic difficulties. When a country does not fare well economically, citizens’ views on providing help to others remain negative, irrespective of individual-level utilitarian and identity considerations. Our findings have implications for understanding the decision-making calculus underlying preference formation.

Cross‐Country Differences in Unemployment: Fiscal Policy, Unions, and Household Preferences in General Equilibrium

AbstractWe develop a five‐period overlapping generations model with individuals who differ by ability and with an imperfect labour market (union wage setting) for individuals of lower ability. The model explains human capital formation, hours worked, and unemployment within one coherent framework. Its predictions match the differences in the unemployment rate across 12 OECD countries remarkably well. A Shapley decomposition of these differences reveals an almost equal role for fiscal policy variables and union preferences. As to fiscal policy, differences in unemployment benefits play a much more important role than tax differences. Differences in households’ taste for leisure are unimportant.

The influence of consanguinity on reproductive health in a population of western Algeria (SABRA)

Background Inbreeding refers to unions between two people with at least one common ancestor. The practice of this type of marriage in Algeria and in the Arab-Muslim world is still commonplace. The purpose of this study is to determine the prevalence of consanguinity and to examine the impact of this practice on a few health parameters, including reproductive health: fertility, prenatal, perinatal, neonatal and postnatal mortality. Methods A prospective cohort study was conducted on 123 people randomly recruited from the Sabra Public Health Proximity Institution (EPSP). The data were collected using a pre-established questionnaire, which included questions about women's clinical, sociodemographic, and reproductive history characteristics. These data were processed by the khideux test. Results The consanguineous unions all degrees combined in our population represent a proportion of 33.33% with a slight preference for unions between first cousins. Our results also show an early marriage age and increased fertility, as well as a significant association between consanguinity and reproductive health (abortion, mortality, and morbidity). Conclusion Consanguineous marriage seems to be a predictive risk factor for certain fitness parameters, which is why setting up a health education program is fundamental to targeting prevention in terms of risk, which can have adverse effects on health, particularly the reproductive health that can weigh heavily on the family and the community.

Trade Unions and the Minimum Wage

Why do labor unions and left/labor parties support the statutory minimum wage in some countries, such as the United States, but oppose it in others, such as Denmark or Sweden? This paper presents a formal model of trade union preferences for the statutory minimum wage. On the one hand, the minimum wage can raise above-minimum negotiated wages by increasing the union’s fallback position and increasing the labor costs of nonunion competitor firms. On the other hand, the minimum wage presents certain dangers: it may (1) set wages higher or lower than unions prefer, (2) reduce the incentives of workers to join unions in the short term, and (3) undermine the social custom that sustains union membership in the long term. For these reasons, we predict that unions and left/labor parties will support a statutory minimum wage only when unions are too weak — when unions bargain with a smaller share of firms, when they are legally restricted from engaging in certain strike actions, and wage bargaining is less coordinated — to sustain high wages on their own. Empirically, we document a robust, cross-national correlation between several of the key variables in our model and the type of minimum wage setting institution and illustrate the model’s mechanisms using case studies of union preferences in the US, UK, Germany, and Sweden and party preferences in the UK and Germany.

Air traffic control regulation with union bargaining in Europe

This paper studies the behavior of the national air traffic control (ATC) centers in the EU as it relates to bargaining between a union and government. We analyze wage formation, the reactions of ATC's to a price-cap, the slow adoption of new technologies, the reluctance to vertically disintegrate, the slow standardization, and the failures of mergers of neighboring ATC's. The theory is illustrated by using estimated union preference parameters and bargaining power parameters for the government. We find that bargaining power and union preferences vary greatly by country.

Union recognition and union security

PurposeUnion membership has declined in many countries reducing union capacity to bargain and contribute to economic equality. This paper aims to explore a more hopeful case in an Australian state, where the dramatic anti-union strategies of conservative governments have been reversed by Labor governments.Design/methodology/approachThe research frames union recognition and union security in an international context, highlighting differences between US, Canadian, UK and Australian approaches. The research focuses on the Australian state of Queensland, providing an historical account of changes to union recognition and union preference provisions, drawing on legislation, major public service agreements, newspapers and parliamentary transcripts.FindingsConservative governments in Australia have implemented anti-union strategies, and Labor governments have often failed to restore union-friendly provisions when re-elected. In contrast, the Queensland study demonstrates a substantial restoration of union security provisions when Labor governments are re-elected, rebuilding political capital with unions and potentially supporting union membership. This difference is due to unique political and institutional factors that provide governments with unfettered powers to legislate their industrial relations agenda, whether in support or otherwise of unions, and has led to the more distinctive pendulum swings to the right and left than occurred elsewhere in Australia.Originality/valueThe research contributes to debates about the factors related to declining union membership and highlights a case where unions have achieved restoration of many provisions that increase their influence and potentially their membership.

Learning to Love the Government

One counterintuitive variation in wage-setting regulation is that countries with the highest labor standards and strongest labor movements are among the least likely to set a statutory minimum wage. This, the author argues, is due largely to trade union opposition. Trade unions oppose the minimum wage when they face minimal low-wage competition, which is affected by the political institutions regulating industrial action, collective agreements, and employment, as well as by the skill and wage levels of their members. When political institutions effectively regulate low-wage competition, unions oppose the minimum wage. When political institutions are less favorable toward unions, there may be a cleavage between high- and low-wage unions in their minimum wage preferences. The argument is illustrated with case studies of the UK, Germany, and Sweden. The author demonstrates how the regulation of low-wage competition affects unions’ minimum wage preferences by exploiting the following labor market institutional shocks: the Conservatives’ labor law reforms in the UK, the Hartz labor market reforms in Germany, and the European Court of Justice'sLavalruling in Sweden. The importance of union preferences for minimum wage adoption is also shown by how trade union confederation preferences influenced the position of the Labour Party in the UK and the Social Democratic Party in Germany.

The EU and Russia's conflicting regime preferences in Ukraine: assessing regime promotion strategies in the scope of the Ukraine crisis

This paper evaluates the competitiveness of the European Union (EU) and Russia's regime preferences in their foreign policies towards Ukraine in the scope of the on-going Ukraine crisis. It is argued that the underpinning geopolitical environment Ukraine currently resides in, wedged between two much larger powers (the EU and Russia), renders it a vulnerable target state for regime promotion from both sides. Indeed, since the 2004 Orange revolution in Ukraine, both the EU and Russia have had discernible regime promotion strategies in their foreign policies. The EU's regime promotion has focussed on facilitating democracy in Ukraine, along with more material interests (trade and strategic aims) while Russia has reacted with increasingly zero-sum policies which pursue its preference for having a loyal and Russian-facing regime in Ukraine. Ultimately, the increasing competitiveness of the EU and Russia has been a key factor in the onset of the Ukraine crisis, which offers important insight into the relationship between large powers and the smaller third states which lie in their overlapping spheres of influence.

Endogenous R&D networks when labour unions have preferences over wages and employment

We develop a model to analyse the pattern of R&D network formation when unions have relative preferences over wages and employment. Within a three-firm industry, we show that when the unions place a low weight on wages and technological spillovers are low, a partial R&D network that includes two firms but excludes the third emerges in equilibrium. In contrast, when the unions care a lot about wages, a complete R&D network that includes all firms emerges. For all other intermediate levels of union preferences over wages, there is no strong stable equilibrium network. Empirical implications emerge from these findings, which are also discussed.

Existing challenges associated with offering prenatal genetic diagnosis in an Arab society in the Sultanate of Oman.

The incidence of congenital anomalies and/or genetic disorders in the Omani population has reached figures greater than double the global statistics. Preference for consanguineous unions together with the fact that termination of pregnancy in Muslim communities are largely avoided, have been highlighted as contributing factors. This overview identifies a third significant aspect contributing to the elevated rate of genetic disorders in the Omani population. Namely, a lack of services that are able to offer termination of pregnancy for severe congenital anomalies, to requesting parents. In this report we select an unusual case of a family at risk for two distinct genetic disorders--6q micro-deletion and unbalanced products of conception attributed to a balanced parental translocation involving chromosome 3 and 13, to portray and examine the current situation faced by Omani couples interested in prenatal diagnosis for termination of pregnancy. Additional challenges and pitfalls to developing a prenatal diagnostic service as part of the genetic service in Oman are discussed.

On the Importance of Affirmative Action: Labor Liberals and the Recasting of “Contract Unionism”

This issue's Up For Debate features Dennis Deslippe's revisionist argument about labor's response to affirmative action. Contrary both to those scholars who have fixed the unions as a primary obstacle to affirmative action plans pushed by civil rights organizations and public officials and to those who have identified affirmative action as an unalterable stumbling block for collective (as opposed to individual) rights on the job, Deslippe suggests a middle path of accommodation to the letter and spirit of the equal-opportunity cause on the part of an identifiable “labor liberal” sector of unions and their leaders, who opted for a progressively modified version of traditional “contract unionism.” Though such accommodation to the demands of minorities and women proved easier in relation to hiring than layoffs (where nearly all unions took a stand against the abridgment of the seniority principle), Deslippe finds that the labor movement as a whole was not the benighted monolith turning its back to the future that it appears to be in some accounts of the 1970s. Moreover, rather than an inevitable clash between union “solidarity” versus the “rights claims” of the new social movements, Deslippe suggests that the most successful unions of the period were precisely those that embraced the spirit and constituencies associated with the civil rights and women's movements. The respondents give Deslippe mixed marks. For Paul Moreno, the only good union seems to be a weak union, for to him any union preference or job protection is an economically inefficient “privilege” inevitably blocking minority access to authentic “freedom of contract.” Ava Baron welcomes Deslippe's attempt to identify a historical move among unionists to overcome divisions of race and gender, but she fears that he underestimates the basic contradictions of a labor law based on collective bargaining (and never constitutionally anchored) and employment law rooted in a deeper-sanctioned civil rights agenda. While welcoming Deslippe's challenge to the either/or view of unionism versus new social movement dichotomy of the 1960s and 1970s, both Joseph McCartin and William Jones insist on a more sector-specific (and, for McCartin, more time-sensitive) approach to the unions' evolving affirmative action policies. The large nonwhite and female memberships of the unions that chose the “egalitarian” policy path, suggests Jones, are perhaps both telling and limiting qualifiers to the expanded reach of contract unionism. Deslippe, of course, enjoys the last word.

A Note on Trade Unions, Unemployment Insurance, and Endogenous Growth

One of the most important economic problems in Europe today is the apparently permanent high rate of unemployment associated with unionized labor markets. The effects of unionization on economic growth are recognized by the most part of the growth theoretical literature framed in the standard overlapping generations model to be either negative or at most neutral, with some exceptions. Developing a model in line with this strand of literature, we show a rather unusual result: the unionization of the labor market in the conventional double Cobb–Douglas economy may always promote economic growth when unemployment benefits are financed by a consumption tax rather than a wage tax, and the union's preference weight on raising wages is sufficiently low.

The structure of the labor market, telecommuting, and optimal peak period congestion tolls: A numerical optimization model

This paper extends a standard model of welfare optimal peak-period congestion tolls to take into account two characteristics of typical European labor markets, viz. wage bargaining and the increasing potential of telecommuting as an alternative to working on-the-job. Specifically, we consider the government's problem of determining optimal labor and peak-period transport taxes under two different labor market structures, viz., a competitive labor market and a wage bargaining setting. The models include commuting and non-commuting transports, and they allow for telecommuting. We implement the models numerically using Belgian data. Results include the following. First, if union preferences reflect the transport concerns of their members, we find that optimal congestion taxes under competitive labor market conditions exceed those under bargaining by 10–17%. Second, the combination of substantially higher transport taxes and lower labor taxes compared to the reference situation jointly implies that the optimal tax structure strongly stimulates telecommuting for both labor market structures considered. Third, it is found that improving the efficiency of telecommuting results in a considerable reduction of optimal congestion tolls.