The Trade-Off between Wages and Employment in Trade Union Objectives

31 Pages Posted: 3 Jan 2002 Last revised: 19 Nov 2022

See all articles by John H. Pencavel

John H. Pencavel

Stanford Institute for Economic Policy Research (SIEPR); IZA Institute of Labor Economics

Date Written: March 1982

Abstract

This paper demonstrates that, contrary to a widely-held opinion, the determination of the goals of unions is fully amenable to empirical analysis. A characterization of the wage and employment-setting process in unionized markets is adopted and its qualitative implications examined. The first-order condition for this model is fitted to time- series data on the newspaper industry from ten cities. The Inter- national Typographical Union 's objective function reveals very restricted opportunities for substituting wages for employment in response to a change in the slope of the employer's labor demand function. Larger union locals place greater emphasis on wages versus employment than smaller union locals.

Suggested Citation

Pencavel, John H., The Trade-Off between Wages and Employment in Trade Union Objectives (March 1982). NBER Working Paper No. w0870, Available at SSRN: https://ssrn.com/abstract=291740

John H. Pencavel (Contact Author)

Stanford Institute for Economic Policy Research (SIEPR) ( email )

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IZA Institute of Labor Economics

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Germany

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