An odd couple? When mainstream economists join forces with trade unions

Abstract

The doubtful tendencies of neoclassical economics towards labour market intervention put it at odds with trade unions, whose raison d’etre is worker protection through de-linking compensation from market dynamics. Therefore, the recent ‘economic professionalisation’ of the Histadrut, Israel's main Labour Federation, is puzzling. Against economists’ traditional involvement in unions, in advisory roles and macro-level policymaking, Histadrut economists have gained a pivotal position in micro-level collective bargaining. What drives such economic professionalisation of trade unions, and what are its consequences? We argue as their traditional power resources have weakened and industrial relations have become highly complex, unions rely on professional economists as an alternative power resource. In the Histadrut, whose political-economic position has transformed dramatically, economic professionalisation was accompanied by other novel strategies of union revitalisation. We also argue union empowerment through economic professionalisation nurtures within them a particular approach to collective bargaining, characterised by depoliticised view of industrial relations and ‘market-friendly’ tendency in collective agreements.