Hypothesis examines union workers' wage demands in response to privatisation, implying no earnings change post-privatisation.
The hypothesis examined here is that public transport union workers perceive privatisation to be a threat to the security of union jobs and respond by moderating their wage demands. However, estimates of the union earnings premiums over the non-union earnings of public sector bus drivers indicate there has been no change un the post-privatisation period, compared with the pre-privatisation period.
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Wayne K. Talley (1998) studied this question.
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