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Union oligopoly and entry in the presence of homogeneous labor

Author

Listed:
  • Ana Paula MARTINS

    (Universidade Católica Portuguesa, Department of Economics. This research started while the author was Invited Professor at Faculdade de Economia da Universidade Nova de Lisboa, Portugal)

Abstract

The analysis discusses the labor market equilibrium under union oligopoly, where unions represent homogeneous workers and use employment strategies. The following points are addressed: 1. The labor market outcomes in the presence of; a. uncooperative behavior among unions; b. uncooperative environment with a leading union; c. collusive (coordinated unions) behavior among unions; d. globally efficient bargaining, are confronted. A specific example with a Stone-Geary utility function and linear demand is forwarded. 2. Supply dynamics may push up employment and, therefore,the number of unions. In equilibrium, some bounds exist to the number of unions the market can support, which are investigated in the example. Five supply dynamics are considered: a. reservation wage restriction; b. a standard labor supply constraint; c. number of unions equal demand; d. individualistic unions; e. existence of a minimum (employed) membership requirement. The equilibrium number of unions for the Cournot-Nash, Stackelberg and efficient bargaining structures is derived for the case where unions exhibit Stone-Geary preferences and labor demand is linear

Suggested Citation

  • Ana Paula MARTINS, 2020. "Union oligopoly and entry in the presence of homogeneous labor," Journal of Economics and Political Economy, EconSciences Journals, vol. 7(1), pages 47-74, March.
    • Handle: RePEc:cvv:journ1:v:7:y:2020:i:1:p:47-74
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    References listed on IDEAS

    as
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    4. Davidson, Carl, 1988. "Multiunit Bargaining in Oligopolistic Industries," Journal of Labor Economics, University of Chicago Press, vol. 6(3), pages 397-422, July.
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    More about this item

    Keywords

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    JEL classification:

    • J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • D49 - Microeconomics - - Market Structure, Pricing, and Design - - - Other
    • C79 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Other

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