Ghent revisited: Unemployment insurance and union membership in Belgium and the Nordic countries

The exceptionally high union density rates in Denmark, Finland and Sweden are attributed to a particular form of voluntary unemployment insurance, known as the Ghent system. Heavily subsidized by the state and administered by union funds, it strongly motivates workers to become union members. Belgium has a partial Ghent system: while unemployment insurance is compulsory, trade unions retain an important role in the provision of benefits. Belgian union density is at an intermediate level; but as in other Ghent countries, its level is currently higher than in the 1970s. This article argues that the Belgian institutional set-up provides stronger incentives for manual workers in industry with lower educational attainment and a past unemployment record. In Denmark, Finland and Sweden, the Ghent system recruits workers across different occupations and educational levels. However, its appeal seems to have lessened over recent years, particularly among younger workers.