Pensions, Unions and Implicit Contracts

This paper analyzes the relation of pension coverage and key plan characteristics to measures of union membership and strength, and to related interactions. The large and significant relationships which are found cannot be explained by, and are often inconsistent with, predictions obtained by extending the major explanations for the existence of pensions to allow for union monopoly effects. The findings support some (but not other) explanations in which the impetus for pensions arises more directly from the behavior of unions, and suggest that behavioral and related policy analyses of pensions should be conducted separately for the union and nonunion sectors