Insider-Outsider Conflict and the Persistence of Unemployment : A Union Approach

• This paper examines whether the degree of "insider-outsider" effects in wage and employment determination varies across labour unions, and discusses which economic factors might explain such differences. The Blanchard-Summers [1986] model of membership rules and unemployment persistence is estimated using a unique panel data set on 16 Swedish blue-collar unions. While the evidence rejects the theory in aggregate regressions, the tendency to disenfranchise unemployed workers seems to be present in individual unions. Moreover, the findings suggest that the degree of insider behaviour varies considerably across unions. Particularly, insider-outsider effects seem to be stronger in unions whose members operate in sheltered or expansionary industries, as well in unions with large memberships or large flows of temporary members. Two conclusions follow from the analysis. First, lacking support in favour of the insider-outsider hypothesis in aggregate regressions need not imply that insider-outsider effects are absent in wage and employment determination. Second, cross union variations in the aptitude for disenfranchising the unemployed seem to emanate from differences in union-specific labour market conditions.

Ämnesord

SAMHÄLLSVETENSKAP  -- Ekonomi och näringsliv -- Nationalekonomi (hsv//swe)

SOCIAL SCIENCES  -- Economics and Business -- Economics (hsv//eng)

Publikations- och innehållstyp

ovr (ämneskategori)

vet (ämneskategori)