Trade Union Behaviour and Wage Determination in Great Britain

Abstract

Economists have sought to fit a trade union into the framework of economic analysis by considering it as a form of institution analogous to the firm. They have assumed it to be a monopolistic seller of labour seeking to maximize the incomes of its total membership. This view of a trade union has been severely assailed by Professor Ross ¹ on the grounds that it bears little relation to reality. The central proposition of the Californian School is that a trade union is a political institution dominated by the primary motive of survival and operating in an economic environment. Formally its objectives are to maximize the economic welfare of its members, but the attainment of these objectives will be constantly modified by institutional necessities, so that it cannot be assumed that a union will behave automatically in the same manner as a business enterprise whose primary object is to maximize profit.