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An Important Unanswered Question About the Role of Unions in Developed

Question 99

Multiple Choice

An important unanswered question about the role of unions in developed economies is whether the presence of unions affects long- run productivity.There is some evidence to suggest that the presence of a union


A) decreases the human capital of unionized workers,and therefore reduces long- run productivity.
B) reduces the expected profitability of installed capital and therefore leads to reduced capital investment by firms.
C) increases the human capital of unionized workers,which leads to increased long- run productivity for the firm.
D) reduces the level of employment (because of the union- wage premium) and thus raises the marginal product of labour.
E) reduces the demand for labour and therefore the demand for physical capital.

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