Norm-Based Trade Union Membership: Evidence for Germany
University of Trier - Institute of Labour Law and Industrial Relations in the European Union; CESifo (Center for Economic Studies and Ifo Institute); Institute for the Study of Labor (IZA)
University of Applied Sciences Bielefeld - Department of Business and Economics; DIW Berlin - GSOEP; Institute for the Study of Labor (IZA), Bonn
IZA Discussion Paper No. 962
In the absence of closed-shops and discriminatory wage policies, union membership can be explained by the existence of social norms. We describe a model, incorporating institutional features of the German labour market, which explicitly allows for social custom effects in the determination of union membership. Using panel data for Germany, we find evidence for according effects which restrict freeriding. The impact of social norms tends to increase with net union density. Hence, observed reductions in the demand for union membership can weaken the impact of a norm and accentuate the free-rider problem.
Number of Pages in PDF File: 29
Keywords: Germany, norms, social custom, trade union membership
JEL Classification: D71, J51
Date posted: January 19, 2004
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