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Monopoly Unions and Corporatism: Implications for Strategic Trade Policy

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  • S. Bandyopadhyay
  • S. C. Bandyopadhyay

Abstract

This paper analyzes the effects of corporatism on wage, employment, and optimal trade policy in the context of international market share rivalry. A Striking result of the paper is that when an optimal (Nash)subsidy is in place, wages, employment and the level of the optimal export subsidy itself become independent of the degree of corporatism. This result breaks down under free trade or when domestic policy makers endogenize the foreign wage, yielding in the familiar negative relationship between the degree of corporatism and wages. [F13, J51]

Suggested Citation

  • S. Bandyopadhyay & S. C. Bandyopadhyay, 1998. "Monopoly Unions and Corporatism: Implications for Strategic Trade Policy," International Economic Journal, Taylor & Francis Journals, vol. 12(4), pages 1-22.
    • Handle: RePEc:taf:intecj:v:12:y:1998:i:4:p:1-22
    DOI: 10.1080/10168739800000018
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    References listed on IDEAS

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    1. Brander, James A. & Spencer, Barbara J., 1988. "Unionized oligopoly and international trade policy," Journal of International Economics, Elsevier, vol. 24(3-4), pages 217-234, May.
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    4. Mezzetti, Claudio & Dinopoulos, Elias, 1991. "Domestic unionization and import competition," Journal of International Economics, Elsevier, vol. 31(1-2), pages 79-100, August.
    5. Driffill, John & van der Ploeg, Frederick, 1993. "Monopoly Unions and the Liberalisation of International Trade," Economic Journal, Royal Economic Society, vol. 103(417), pages 379-385, March.
    6. Bulow, Jeremy I & Geanakoplos, John D & Klemperer, Paul D, 1985. "Multimarket Oligopoly: Strategic Substitutes and Complements," Journal of Political Economy, University of Chicago Press, vol. 93(3), pages 488-511, June.
    7. Bandyopadhyay, Subhayu, 1997. "Demand elasticities, asymmetry and strategic trade policy," Journal of International Economics, Elsevier, vol. 42(1-2), pages 167-177, February.
    8. Brander, James A. & Spencer, Barbara J., 1985. "Export subsidies and international market share rivalry," Journal of International Economics, Elsevier, vol. 18(1-2), pages 83-100, February.
    9. Driffill, John & van der Ploeg, Frederick, 1995. " Trade Liberalization with Imperfect Competition in Goods and Labour Markets," Scandinavian Journal of Economics, Wiley Blackwell, vol. 97(2), pages 223-243, June.
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    Cited by:

    1. Takauchi, Kazuhiro, 2015. "Strategic export policy, monopoly carrier, and product differentiation," MPRA Paper 66003, University Library of Munich, Germany.
    2. Luciano Fanti & Domenico Buccella, 2020. "Strategic trade policy with socially concerned firms," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 67(3), pages 269-292, September.

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