Whatever goals unions pursue and whatever strategies they employ, the impact of their activities on hiring and wages depends a great deal on the elasticity of labor demand.

    Naturally more concentrated, monopolistic industries will have more inelastic labor demand, as will industries in which it is difficult to substitute other factors for labor. It is in these industries where unions are most likely to be effective. Further, any actions they can take to increase productivity will help both increase employment and wages.

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