Citation

Discussion Paper Details

Please find the details for DP114 in an easy to copy and paste format below:

Full Details

Title: Union Activity and Economic Resilience

Author(s): Assar Lindbeck and Dennis J. Snower

Publication Date: June 1986

Keyword(s): Economic Resilience, Insider-Outsider Analysis, Labour Unions, Unemployment, Union Activity and Wage-Unemployment Movements

Programme Area(s): Applied Macroeconomics and International Macroeconomics

Abstract: The paper analyzes how the influence of labour unions over wage contracts may make an economy less "resilient". Loss of resilience is depicted in two conceptually independent ways: (i) the tendency of exogenous variations in unemployment to become perpetuated and (ii) the possibility that such swings may give rise to a wage-unemployment ratchet. In this manner, the analysis attempts to provide an explanation of why unemployment rates in Europe and the United States have displayed an upward trend over the past fifteen years and why the United States recovered much more speedily from the recession of the early 1980s than did most European economies.

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Bibliographic Reference

Lindbeck, A and Snower, D. 1986. 'Union Activity and Economic Resilience'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=114