Trade unions question paragraphs

Question 1

Intro

Answer 1

Trade unions are organizations formed by workers

Question 2

Collective bargaining power

Answer 2

Trade unions can improve worker wages by engaging in negotiations with employers and utilising collective bargaining power to increase the real wages of their members and therefore improve welfare

Question 3

Counter to monopsony

Answer 3

Unions can act as a counter to the monopsony power of employers who may pay low wages and spend less on worker training

Question 4

Prevent unemployment

Answer 4

Unions can help to prevent structural unemployment and protect members by campaigning against job losses

Question 5

Evaluation of trade union mark ups

Answer 5

If wages rise faster than productivity, firms will see a rise in unit costs and this can negatively affect profits and actually increase unemployment.

Question 6

Evaluation of counter to monopsony

Answer 6

Monopsony employers do not actually always pay lower wages than necessary. Many understand the positive link between pay and productivity and pay fair wages in order to motivate workers.

Question 7

Evaluation of prevent unemployment

Answer 7

Unions may impede competitiveness if they seek to block the implementation of technologies that replace workers with machines.