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How Labour Markets affect Trade Policies and Trade: The Case of the Foreign Labour Union


  • K. C. Fung

    () (University of California, USA)


This paper highlights the point that the presence of a foreign union affects significantly the characterization of domestic trade policies, and thus, trade. Specifically, both the objective functions of the foreign union and the nature of interactions between the foreign firm and the foreign union are important determinants of the sign and magnitudes of the domestic trade policies. The importance of the foreign union effect holds regardless of whether the domestic trade policies are politically motivated or whether they are set to maximize national welfare. The foreign union effect is also present with or without a domestic producer. Copyright 2003 Blackwell Publishing Ltd.

Suggested Citation

  • K. C. Fung, 2003. "How Labour Markets affect Trade Policies and Trade: The Case of the Foreign Labour Union," Pacific Economic Review, Wiley Blackwell, vol. 8(1), pages 57-70, January.
  • Handle: RePEc:bla:pacecr:v:8:y:2003:i:1:p:57-70

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