THE DETERMINANTS OF AUSTRALIAN TRADE-UNION MEMBERSHIP

This paper investigates the determinants of trade union membership in Australia using the Engle and Granger (1987) theory of co-integrated e conomic variables. Applying the theory of co-integration yields a mode l of union membership which can be interpreted as distinguishing betwe en long-run and 'business cycle' determinants of union membership. The principal long-run determinant of union membership is found to be the level of employment disaggregated by industry classification. Busines s cycle variables-the real wage and the change in unemployment-are als o shown to influence movements in union density. These findings are co nsistent with recent studies which have attributed the decline in unio n membership in Australia since the early 1980s to the changing compos ition of employment and movements in the rate of unemployment.