Union Mediation and Adaptation to Reciprocal Loyalty Arrangements

This study assesses the industrial relations application of the „loyalty-exit-voice‟ proposition. The loyalty concept is linked to reciprocal employer-employee arrangements and examined as a job attribute in a vignette questionnaire distributed to low and medium-skilled employees. The responses provided by employees in three European countries indicate that reciprocal loyalty arrangements, which involve the exchange of higher effort for job security, are one of the most desirable job attributes. This attribute exerts a higher impact on the job evaluations provided by unionised workers, compared to their non-union counterparts. This pattern is robust to a number of methodological considerations. It appears to be an outcome of adaptation to union mediated cooperation. Overall the evidence suggests that the loyalty-job evaluation profiles of unionised workers are receptive to repeated interaction and negative shocks, such as unemployment experience. This is not the case for the non-union workers. Finally, unionised workers appear to „voice‟ a lower job satisfaction, but exhibit low „exit‟ intentions, compared to the non-unionised labour.

Unionisation, International Integration and Selection

We study how unionisation affects competitive selection between heterogeneous firms when wage negotiations can occur at the rm or at the profit-centre level. With productivity specific wages, an increase in union power has: (i) a selection-softening; (ii) a counter-competitive; (iii) a wage-inequality; and (iv) a variety effect. In a two-country asymmetric setting, stronger unions soften competition for domestic firms and toughen it for exporters. With profit-centre bargaining, we show how trade liberalisation can affect wage inequality among identical workers both across firms (via its effects on competitive selection) and within firms (via wage discrimination across destination markets).

Unionisation, International Integration and Selection

We study how unionisation affects competitive selection between heterogeneous firms when wage negotiations can occur at the firm or at the profit-centre level. With productivity specific wages, an increase in union power has: (i) a selection-softening; (ii) a counter-competitive; (iii) a wage-inequality; and (iv) a variety effect. In a two-country asymmetric setting, stronger unions soften competition for domestic firms and toughen it for exporters. With profit-centre bargaining, we show how trade liberalisation can affect wage inequality among identical workers both across firms (via its effects on competitive selection) and within firms (via wage discrimination across destination markets).