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Integration, Labor Market Regulation, Lobbying, and Technological Change

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Author Info
Palokangas, Tapio K. () (University of Helsinki)

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Abstract

This paper examines an economic union where oligopolistic firms produce by skilled and unskilled labor and do in-house R&D by skilled labor. The planner of the union accepts new members to the union, regulates the labor market through a minimum wage for unskilled labor and supports firms by taxation. Firms and workers lobby the planner for prospective policy. It is shown that in the political equilibrium small unions regulate the labor market but do not support firms, while large unions deregulate the labor market and support firms.

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Publisher Info
Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 4096.

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Length: 21 pages
Date of creation: Mar 2009
Date of revision:
Handle: RePEc:iza:izadps:dp4096

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Related research
Keywords: economic integration; minimum wage; market power; endogenous technological change;

Find related papers by JEL classification:
F15 - International Economics - - Trade - - - Economic Integration
J50 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - General
O40 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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This page was last updated on 2009-11-23.

This information is provided to you by IDEAS at the Department of Economics, College of Liberal Arts and Sciences, University of Connecticut using RePEc data on a server sponsored by the Society for Economic Dynamics.