Trade Unions, Unemployment, Economic Growth, and Income Inequality

Chang, Juin‐jen; Hung, Hsiao-wen

doi:10.1017/s1365100514000443

Cited by 22 publications

(14 citation statements)

References 69 publications

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“…12 A more general specification would be to assume a right-to-manage framework or that the union and employers bargain over both wages and employment through a generalized Nash bargaining solution, as for instance in Chang and Hung (2016). However, given our focus on gender issue we adopt a simpler specification for simplicity.…”

Section: Wages and The Labor Marketmentioning

confidence: 99%

Gender Gaps in the Labor Market and Economic Growth

Agénor

Karakurum-Ozdemir²,

Moreira

2018

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This paper studies the effects of policies aimed at mitigating discrimination against women in the marketplace on the gender wage gap, decisions to invest in skills, the composition of employment and unemployment, and long-run growth. The analysis uses a gender-based overlapping generations model with labor market rigidities. Gender bias in the workplace varies inversely with the presence of skilled women (as agents of change) in the labor market and has a direct impact on their bargaining power in the family. The model is calibrated for Morocco. Experiments show that although the benefits of policies aimed at mitigating gender bias in the workplace can promote growth and be significantly magnified through a stronger presence of skilled women in the labor market, a trade-off may emerge with respect to female unemployment when anti-discrimination policies are combined with policies aimed at subsidizing women's training. To internalize this trade-off, anti-discrimination policies in the marketplace may need to be complemented by measures aimed at reducing labor costs and raising productivity.

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Section: Wages and The Labor Marketmentioning

confidence: 99%

Gender Gaps in the Labor Market and Economic Growth

Agénor

Karakurum-Ozdemir²,

Moreira

2018

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“…In this case, we assume that through a generalized Nash bargaining problem, both the union and the employers' federation negotiate simultaneously over wages and employment, taking into consideration the demand of final goods firms' for intermediate goods. 9 Formally, in line with Chang and Hung (2016) and Chang et al (2007), the optimization problem can be written as…”

Section: Final Goods Sector-firms Trade Unions and Bargaining Strucmentioning

confidence: 99%

How Powerful Are Trade Unions? A Skill-Biased Technological Change Approach

2017

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This paper proposes a new theoretical framework aimed at understanding the link between technological change, skill premium, and employment. We build an endogenous growth model of directed technological change with vertical research and development (R&D) in which low-skilled workers might be organized in a trade union. This union can act as a monopoly seller of labor and decide unilaterally the low-skilled wage, or as a managerial union that bargains wage and employment with the employers' federation, i.e., firms. Our results suggest that (i) the impacts of trade unions on technological-bias and on the level of (un)employment crucially depend on their type and preferences; and (ii) trade unions can actually increase low-skilled wages and employment if they have some bargaining power and are employment-oriented. Furthermore, our framework provides some highlights to explain the relationship between wage dispersion and the deunionization process that occurred in the United Kingdom and the United States during the 1980s.

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“…Structural rigidities can be referred to government legislation on minimum wages, mandated firing costs, unemployment benefits, collective bargaining, and Shapiro-Stiglitz style efficiency wages. A large number of studies focusing on one or two of these rigidities have been made in recent years, which include Varga et al (2014), Bhattacharyya and Gupta (2015) and Chang and Hung (2016) on the collective bargaining front, and Bucci et al (2003), Meckl (2004), Parello (2011), and Zagler (2011) on the efficiency wage front. 1 A key result from the literature is that the relationship between growth and unemployment may be weak, both on impact and in the long run.…”

Section: Introductionmentioning

confidence: 99%

Unemployment, growth and welfare effects of labor market reforms

Agénor

Lim²

2018

Journal of Macroeconomics

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The e¤ects of labor market reforms are studied in an innovation-driven model of endogenous growth with a heterogeneous labor force, labor market rigidities, and structural unemployment. The model is calibrated for a stylized middle-income economy in Latin America and used to perform a range of experiments, including both individual labor market reforms (cuts in the minimum wage and unemployment ben-e…t rates) and composite reform programs involving additional measures. The results show that individual reforms may generate con ‡icting e¤ects on growth and welfare in the long run, even in the presence of positive policy externalities. A reduction in training costs may also create an oversupply of quali…ed labor and higher unemployment in the long run. Public investment in infrastructure, partly through its e¤ects on innovation, can help to mitigate this oversupply problem.

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Trade Unions, Unemployment, Economic Growth, and Income Inequality

Cited by 22 publications

References 69 publications

Gender Gaps in the Labor Market and Economic Growth

Gender Gaps in the Labor Market and Economic Growth

How Powerful Are Trade Unions? A Skill-Biased Technological Change Approach

Unemployment, growth and welfare effects of labor market reforms

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