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Unionisation Structure and Outward Foreign Direct Investment

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  • Arijit Mukherjee
  • Kullapat Suetrong

Abstract

We analyse the effects of the unionisation structure on the incentive for outward foreign direct investment (FDI) and on union utility. The incentive for outward FDI is higher under a centralised union than under decentralised unions, irrespective of the number of firms in the industry. If the number of firms undertaking FDI is higher under a centralised union than under decentralised unions, wages and the union utility can be higher under the latter unionisation structure, depending on the competitiveness of the industry. There may not be a conflict of interest between domestic labour union and domestic industry about the unionisation structure.

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Bibliographic Info

Article provided by Mohr Siebeck, Tübingen in its journal Journal of Institutional and Theoretical Economics.

Volume (Year): 168 (2012)
Issue (Month): 2 (June)
Pages: 266-279

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Handle: RePEc:mhr:jinste:urn:sici:0932-4569(201206)168:2_266:usaofd_2.0.tx_2-l

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Cited by:
  1. Luciano Fanti & Nicola Meccheri, 2014. "Capacity Choice and Welfare under Alternative Unionisation Structures," Working Paper Series 12_14, The Rimini Centre for Economic Analysis.
  2. Luciano Fanti & Nicola Meccheri, 2014. "Capacity choice and welfare under alternative unionisation structures," Discussion Papers 2014/176, Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy.

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