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Erosion of the Ghent System and Union Membership Decline: Lessons from Finland
Author(s) -
Böckerman Petri,
Uusitalo Roope
Publication year - 2006
Publication title -
british journal of industrial relations
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.665
H-Index - 70
eISSN - 1467-8543
pISSN - 0007-1080
DOI - 10.1111/j.1467-8543.2006.00498.x
Subject(s) - union density , unemployment , quarter (canadian coin) , demographic economics , emigration , economics , labour economics , geography , economic growth , collective bargaining , archaeology
Union density declined in Finland by more than 10 percentage points in less than 10 years. This paper analyses the reasons behind the decline, using micro data from the 1990s. According to our results, the changes in the composition of the labour force and the changes in the labour market explain only about a quarter of this decline. The main reason for the decline appears to be the erosion of the Ghent system, due to the emergence of an independent unemployment insurance fund that provides unemployment insurance without requiring union membership. We also find that the decline in the union density can be attributed to the declining inclination of the cohorts born after the early 1960s to become union members.