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Union Wage Bargaining and European Antidumping Policy in Imperfectly Competitive Markets

Author

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  • Konings, Jozef
  • Vandenbussche, Hylke
  • Veugelers, Reinhilde

Abstract

The purpose of this paper is to analyse the interaction between union bargaining power and the likelihood and type of European antidumping measures (duties and undertakings) in imperfectly competitive product markets. We present a simple theoretical model which is well embedded in EU legal practice, to show that cost asymmetries, induced by union wage bargaining in a European firm, lead to an increase in both the likelihood and the level of antidumping protection against foreign imports of a similar product. In addition, our results indicate that a cost asymmetry, in the form of a unionized wage differential, alters the relative probability of a duty versus an undertaking. We show that the size of these effects depends on the intensity of product market competition. In a further step, we use Belgian firm level micro-data to provide some evidence for our predictions.

Suggested Citation

  • Konings, Jozef & Vandenbussche, Hylke & Veugelers, Reinhilde, 1998. "Union Wage Bargaining and European Antidumping Policy in Imperfectly Competitive Markets," CEPR Discussion Papers 1860, C.E.P.R. Discussion Papers.
  • Handle: RePEc:cpr:ceprdp:1860
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    Cited by:

    1. VANDEBUSSCHE, Hylke & WAUTHY, Xavier, 1999. "European antidumping policy and firms' strategic cholce of quality," Working Papers 1999007, University of Antwerp, Faculty of Applied Economics.
    2. Jerger, Jurgen, 2002. "Globalization, wage setting, and the welfare state," Journal of Policy Modeling, Elsevier, vol. 24(1), pages 1-18, March.

    More about this item

    Keywords

    cost asymmetry; european antidumping policy; Labour Unions; Nash bargaining; Product Market Competition;

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects

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