Earnings-Related Unemployment Benefits in a Unionised Economy

Arbeitspapier

We show that a stronger earnings relationship of unemployment compensation reduces wages and increases employment in an economy in which wages are determined by a trade union that maximises the rent from unionisation. The opposite result applies for a utilitarian union. Using manufacturing and non-manufacturing data for 16 OECD countries, estimates suggest that a 10% increase in the earnings relationship is associated with a 1.9% fall in manufacturing wages, a 0.6% reduction in non-manufacturing wages and a 7.3% reduction in unemployment.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: IZA Discussion Papers ; No. 701

Classification and Topics

• Classification: Wirtschaft ; Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity ; Trade Unions: Objectives, Structure, and Effects ; Unemployment Insurance; Severance Pay; Plant Closings
• Subject: earnings relationship ; OECD ; panel data ; trade union ; unemployment ; unemployment benefits ; Arbeitslosenversicherung ; Lohnersatzleistungen ; Einkommen ; Beschäftigungseffekt ; Lohnverhandlungstheorie ; Gewerkschaftlicher Organisationsgrad ; Schätzung ; Theorie ; OECD-Staaten

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Madsen, Jakob B. ; Goerke, Laszlo
• Event: Veröffentlichung
• (who): Institute for the Study of Labor (IZA)
• (where): Bonn
• (when): 2003

Further information

• Handle: http://hdl.handle.net/10419/20636
• Last update: 10.03.2025, 11:45 AM CET