Merger Profitability in Unionized Oligopoly
We examine how a merger affects wages of unionized labour and, in turn, the profitability of a merger under both Cournot and Bertrand competition. If unions are plant-specific, we find that a merger is more profitable than in a corresponding model with exogenous wages. In contrast to the received literature, we find that it can be more profitable to take part in a merger than being an outsider. For firm-specific unions, on the orther hand, results are reversed.
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|Date of creation:||2000|
|Date of revision:|
|Contact details of provider:|| Postal: Department of Economics, University of Bergen Fosswinckels Gate 6. N-5007 Bergen, Norway|
Web page: http://www.uib.no/econ/
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