A Nonmonopoly Theory of Union Wages and Hours Worked

An extensive literature review considers the union voice effect on firm performance. A theoretical model of labor demand under uncertainty is developed that hypothesizes a linkage between firm performance and the union voice effect. The model generates a positive union effect on wages and hours worked without union monopoly power. The model provides a more detailed conceptual framework for explaining why the union voice effect may improve efficiency within the firm than that currently found in the literature.