Wage bargaining and vertical differentiation
This article intends to apply the Nash Bargaining solution to wage setting in a vertically differentiated oligopoly and to study its welfare effects. The market outcome crucially depends on the bargaining power attributed to the agents. I show that the resulting wage bargaining structure is likely to lead to another source of distortion that adds to the classical one derived by oligopoly pricing and quality choice.
(This abstract was borrowed from another version of this item.)
Volume (Year): 54 (2007)
Issue (Month): 1 (March)
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