Premium
Testing a Model of Trade Union Behaviour: An Application of a Multivariate Cointegration Analysis to UK Aggregate Wage Data
Author(s) -
Fedeli Silvia
Publication year - 1994
Publication title -
labour
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.403
H-Index - 34
eISSN - 1467-9914
pISSN - 1121-7081
DOI - 10.1111/j.1467-9914.1994.tb00219.x
Subject(s) - cointegration , economics , multivariate statistics , wage , aggregate (composite) , econometrics , trade union , manufacturing sector , multivariate analysis , function (biology) , aggregate data , labour economics , mathematics , statistics , materials science , composite material , evolutionary biology , biology
ABSTRACT The first part of the paper considers a behavioural model of trade unionism. Wages and employment are characterized as the outcome of a process by which the union maximizes an objective function containing wages and employment as arguments, and is constrained by a trade‐off between these two variables as represented by the firm's labour demand function. In the second part, the model's equilibrium predictions for wages are estimated in the framework of a multivariate error correction model and tested for cointegration with data from Britain's manufacturing sector from 1967 to 1986.