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Product market competition, external economies of scale and unionized wage

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  • Arijit Mukherjee

Abstract

Although empirical evidence shows that higher product market competition increases unionized wage, the theoretical literature did not pay much attention to this aspect. We show that the positive relation between product market competition and unionized wage may occur in the presence of external economies of scale. In this respect, the labor productivity and the effects of the external economies of scale may play important roles.

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File URL: http://www.nottingham.ac.uk/economics/documents/discussion-papers/11-14.pdf
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Paper provided by University of Nottingham, School of Economics in its series Discussion Papers with number 11/14.

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Handle: RePEc:not:notecp:11/14

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Postal: School of Economics University of Nottingham University Park Nottingham NG7 2RD
Phone: (44) 0115 951 5620
Fax: (0115) 951 4159
Web page: http://www.nottingham.ac.uk/economics/
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Keywords: competition; external economies of scale; unionized wage;

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  1. Layard, Richard & Nickell, Stephen & Jackman, Richard, 2005. "Unemployment: Macroeconomic Performance and the Labour Market," OUP Catalogue, Oxford University Press, number 9780199279173.
  2. John M. Abowd & Joseph S. Tracy, 1988. "Market Structure, Strike Activity, and Union Wage Settlements," NBER Working Papers 2595, National Bureau of Economic Research, Inc.
  3. David A. Macpherson & James B. Stewart, 1990. "The effect of international competition on union and nonunion wages," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 43(4), pages 434-446, April.
  4. Paulo Bastos & Udo Kreickemeier & Peter W. Wright, 2010. "Open-shop unions and product market competition," Canadian Journal of Economics, Canadian Economics Association, vol. 43(2), pages 640-662, May.
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