Question

From an economic perspective, what are the marginal benefits of private sector unions in the U.S.?

Answer 1

In economics, marginal benefits come from an addition of goods and services which as a consumer you may purchase. In the context of a private sector union, this refers to your own addition as part of the group which demands better wages, better working conditions, employee satisfaction, breaks and other safety norms for everyone who becomes a part of the group or who demands for a change via a private sector union.

The net benefit of a private sector union which is a group of people with common demands for a producer is that the working class is able to collectively bargain a lot more and avail better working conditions for themselves in terms of wages, salaries, and other items as stated above.

The simple economic principle of suppliers bargaining power comes into the picture. As an employee you are a supply to the demand of labour force in the economy which employers demand for. As you come together, your ability to negotiate with the buyer which is the companies that employee you increase many folds. If suppliers are scattered and compete against one another, then employers have the added advantage. But when they come together, the prices of goods and services can move up as demand remains constant and people still begin demanding for higher prices or better working conditions without which they may halt work.

Thus, we can conclude by saying that the concept of supply power comes into the picture when we look at the economics of private sector unions in the United States and collective bargaining allows them to have better conditions individually and when we look at the economy as a whole, it becomes better in terms of having an organized labour force which contributes in the best possible manner productively for the countries growth.

Please feel free to ask your doubts in the comments section if any.