Employment Rents and the Incidence of Strikes¶
Juliet B. Schor; Samuel Bowles (1987). Employment Rents and the Incidence of Strikes. The Review of Economics and Statistics 69(4). MIT Press.
| Type | journal article |
| Scope | Comparative and methods |
| Method | econometric |
| Period studied | 1955–1983 |
| Regions | United States |
| Themes | unions strikes, labour markets wages, comparative theory, methods data sources |
| Citation key | schor1987 |
Argument¶
The authors propose the 'employment rent', or cost of job loss, as a measure of labour-market tightness: the expected income lost in a year if a representative worker loses a job. They argue that when this cost is low, unions are less able to stop members and non-members from accepting wages below the union demand. Strikes are then more likely to succeed, and workers strike more often. An OLS strike-incidence model for the US (1955-81, extended to 1983) shows the lagged cost of job loss, with the interest rate, explains most of the variance in strikers as a share of union members. The conventional unemployment rate does far worse. The paper is a US study and has no South African content.
Evidence and method¶
US aggregate annual time series: BLS strikers data, union membership (Troy and Sheflin), contract renewals, vendor performance (BEA Business Conditions Digest), interest rates (CEA), after-tax profit rate (Bowles, Gordon and Weisskopf), Weisskopf's after-tax earnings, unemployment duration for job losers (Duguay and Treyz), and social welfare benefit estimates. Sources are listed in the appendix.