NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Can Monopoly Unionism Explain Publicly Induced Retirement?

Casey B. Mulligan

NBER Working Paper No. 7680
Issued in April 2000
NBER Program(s):   AG   EFG   LS   PE

It has long been suggested that trade unions take actions and favor public policies that reduce the quantity of labor so that union members might enjoy greater labor incomes. Can this explain the prevalence of generous public pension programs inducing retirement? I suggest not, by formalizing the monopoly unionism model and showing how labor's interest in reducing the quantity of labor cannot explain why the old are induced to retire rather than discouraging work among workers of all ages. Discouraging work of a subset of union workers introduces allocative inefficiencies without promoting the objectives of the monopoly union. And, unless the old have a disproportionate influence within the union, union interests cannot explain why public pension programs are so generous.

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Document Object Identifier (DOI): 10.3386/w7680

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