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The labor market effects of trade unions - Layard meets Melitz

  • Jochen Michaelis

    ()

    (Department of Economics, University of Kassel)

  • Marco de Pinto

    ()

    (Institute for Labour Law and Industrial Relations in the EU, University of Trier)

Trade unions are typically able to convert their industrial power into political power. We show that, depending on the parameter constellation, stronger trade unions may be welfare-improving in terms of an increase in aggregate employment and output, if they successfully lobby for lower trade barriers set by the government.

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Paper provided by Institute of Labour Law and Industrial Relations in the European Union (IAAEU) in its series IAAEU Discussion Papers with number 201406.

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Date of creation: Mar 2014
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Handle: RePEc:iaa:dpaper:201406
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  1. Felbermayr, Gabriel & Prat, Julien & Schmerer, Hans-Jörg, 2011. "Globalization and labor market outcomes: Wage bargaining, search frictions, and firm heterogeneity," Munich Reprints in Economics 20471, University of Munich, Department of Economics.
  2. Jonathan Eaton & Samuel Kortum & Francis Kramarz, 2004. "Dissecting trade: firms, industries, and export destinations," Staff Report 332, Federal Reserve Bank of Minneapolis.
  3. Xenia Matschke, 2006. "Do Labor Market Imperfections Increase Trade Protection? A Theoretical Investigation," Working papers 2006-12, University of Connecticut, Department of Economics, revised Apr 2007.
  4. Marco de Pinto & Jochen Michaelis, 2011. "International Trade and Unemployment - the Worker-Selection Effect," MAGKS Papers on Economics 201127, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
  5. Layard, Richard & Nickell, Stephen & Jackman, Richard, 1991. "Unemployment: Macroeconomic Performance and the Labour Market," OUP Catalogue, Oxford University Press, number 9780198284345, March.
  6. Layard, R. & Nickell, S., 1988. "Is Unemployment Lower If Unions Bargain Over Employment?," Papers 308, London School of Economics - Centre for Labour Economics.
  7. Marc J. Melitz, 2003. "The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity," Econometrica, Econometric Society, vol. 71(6), pages 1695-1725, November.
  8. Gene M. Grossman & Elhanan Helpman, 1992. "Protection For Sale," NBER Working Papers 4149, National Bureau of Economic Research, Inc.
  9. Eugene Beaulieu & Christopher Magee, 2004. "Four Simple Tests of Campaign Contributions and Trade Policy Preferences," Economics and Politics, Wiley Blackwell, vol. 16(2), pages 163-187, 07.
  10. Anke Hassel, 2014. "The Paradox of Liberalization — Understanding Dualism and the Recovery of the German Political Economy," British Journal of Industrial Relations, London School of Economics, vol. 52(1), pages 57-81, 03.
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