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Unionisation, Unemployment and Economic growth

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  • Doan Hong Quang
  • Neil Vousden
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    Abstract

    This paper employs a simple overlapping generations endogenous growth model with an R&D sector to establish a link between union bargaining power, long-run unemployment and long-run growth. The model consists of a competitive final goods sector, two intermediate goods sectors, one competitive and the other a monopoly and a competitive R&D sector. Increased union bargaining power in the monopolized intermediate-goods sector is shown to increase wages and unemployment in the sector and reduce the economy’s long-run growth rate. This result is shown to hold for both closed- and open-shop unions.

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    File URL: https://crawford.anu.edu.au/degrees/idec/working_papers/IDEC02-10.pdf
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    Bibliographic Info

    Paper provided by International and Development Economics in its series International and Development Economics Working Papers with number idec02-10.

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    Length: 29 pages
    Date of creation: 2002
    Date of revision:
    Handle: RePEc:idc:wpaper:idec02-10

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    Cited by:
    1. Lucas Bretschger & Karen Pittel, 2005. "Innovative Investments, Natural Resources and Intergenerational Fairness: Are Pension Funds Good for Sustainable Development?," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 141(III), pages 355-376, September.
    2. Luca Gori & Luciano Fanti, 2009. "Right-to-manage unions endogenous growth and welfare," Economics Bulletin, AccessEcon, vol. 29(2), pages 903-917.

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