The Composition of Union Membership: The Role of Pensioners in Italy
Posted: 19 Sep 2000
This paper considers changes in the membership composition of the three leading Italian trade union confederations during the last fifteen years. The analysis emphasizes the remarkable growth of membership among pensioners and the drop in active workers. The key issue here is that intergenerational aspects of unions' membership components are taken into account in the bargaining process. Unions internalize unemployment externalities on pension benefits resultant on the wage outcome as they consider the welfare of all their members in the economy. A formulation of the union monopoly model with endogenous membership supports these findings, while the econometric evaluation of the membership component effects shows that unions are forced to pursue wage moderation and improvements in employment conditions.
JEL Classification: J51
Suggested Citation: Suggested Citation