Individually rational trade union membership
Bulkley, George; Myles, Gareth D.
Date: 27 February 2001
Journal
European Journal of Political Economy
Publisher
Elsevier (North-Holland)
Publisher DOI
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, thus preventing free-riding on the ...
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, thus 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.
Economics
Faculty of Environment, Science and Economy
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