Preprint

Macroeconomic effects of public-sector unions

Motivated by the highly-unionized public sectors, the high public shares in total employment, and the public-sector wage premia observed in Europe, this paper examines the importance of public-sector unions for macroeconomic theory. The model generates cyclical behavior in hours and wages that is consistent with data behavior in an economy with highly-unionized public sector, namely Germany during the period 1970-2007. The union model is an improvement over a model with exogenous public employment. In addition, endogenously-determined public wage and hours add to the distortionary effect of contractionary tax reforms by generating greater tax rate changes, thus producing higher welfare losses.

Language
Englisch

Classification
Wirtschaft
Fiscal Policy
Trade Unions: Objectives, Structure, and Effects
Subject
public sector labor unions
fiscal policy
public wages
public employment

Event
Geistige Schöpfung
(who)
Vasilev, Aleksandar
Event
Veröffentlichung
(who)
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften, Leibniz-Informationszentrum Wirtschaft
(where)
Kiel und Hamburg
(when)
2015

Handle
Last update
10.03.2025, 11:41 AM CET

Data provider

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Object type

  • Preprint

Associated

  • Vasilev, Aleksandar
  • ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften, Leibniz-Informationszentrum Wirtschaft

Time of origin

  • 2015

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