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Unionization and International Market Share Rivalry: A Paradox

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  • Bandyopadhyay, Subhayu
  • Bandyopadhyay, Sudeshna Champati

Abstract

Two exporting firms (domestic and foreign) are considered which are symmetric in all respects except that one is unionized while the other faces a competitive labor market. Under free trade the unionized firm has the lower market share. Paradoxically, in the policy equilibrium, the unionized firm has the larger market share. Consequently, the nation hosting the unionized firm has the higher welfare level. Copyright 1999 by Blackwell Publishing Ltd.

Suggested Citation

  • Bandyopadhyay, Subhayu & Bandyopadhyay, Sudeshna Champati, 1999. "Unionization and International Market Share Rivalry: A Paradox," Review of International Economics, Wiley Blackwell, vol. 7(1), pages 153-161, February.
  • Handle: RePEc:bla:reviec:v:7:y:1999:i:1:p:153-61
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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. Domenico Buccella, 2011. "Labor unions and economic integration: A review," Económica, Departamento de Economía, Facultad de Ciencias Económicas, Universidad Nacional de La Plata, vol. 0, pages 25-89, January-D.
    3. Subhayu Bandyopadhyay & Sudeshna Bandyopadhyay, 2001. "Efficient bargaining, welfare and strategic export policy," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 10(2), pages 133-149.

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