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Abstract:

CEP discussion paper
How Robust is the Microeconomic theory of the Trade Union?
Alan Manning
March 1992
Paper No' CEPDP0065:

This paper argues that the predictions of standard trade union models and the tests for distinguishing between these models are not robust to quite small and reasonable changes in the conventional assumptions. It shows how assuming that the ex post substitutability between labour and capital is less than the ex ante substitutability can reverse much of the conventional wisdom about the effects of trade unions.