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Oligopoly, open shop unions and trade liberalisation

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  • Paulo Bastos
  • Udo Kreickemeier
  • Peter Wright

Abstract

In an international oligopoly model, we investigate how trade liberalisation impacts on collective bargaining outcomes when workers are represented by open shop unions. We find that, with intermediate levels of union density, trade liberalisation may lead to higher negotiated wages even if no trade occurs in equilibrium. In addition, we show that union wages may be higher with free trade than in autarky.

Suggested Citation

  • Paulo Bastos & Udo Kreickemeier & Peter Wright, 2007. "Oligopoly, open shop unions and trade liberalisation," Discussion Papers 07/30, University of Nottingham, GEP.
    • Handle: RePEc:not:notgep:07/30
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    Cited by:

    1. Paulo Bastos & Odd Rune Straume, 2012. "Globalization, product differentiation, and wage inequality," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 45(3), pages 857-878, August.
    2. Yao Liu & Arijit Mukherjee, 2013. "The Effects of Trade Liberalization in a Vertical Structure," Review of International Economics, Wiley Blackwell, vol. 21(5), pages 966-973, November.
    3. Kreickemeier, Udo & Meland, Frode, 2011. "International Trade, Union Wage Premia,and Welfare in General Equilibrium," Working Papers in Economics 04/11, University of Bergen, Department of Economics.
    4. Domenico Buccella, 2011. "Labor unions and economic integration: A review," Económica, Instituto de Investigaciones Económicas, Facultad de Ciencias Económicas, Universidad Nacional de La Plata, vol. 0, pages 25-89, January-D.
    5. Bastos, Paulo & Bottan, Nicolas, 2023. "Resource rents, coercion, and local development: Evidence from post-apartheid South Africa," World Development, Elsevier, vol. 169(C).
    6. Udo Kreickemeier & Frode Meland, 2017. "Non-Traded Goods, Globalization, and Union Influence," World Scientific Book Chapters, in: International Trade and Labor Markets Welfare, Inequality and Unemployment, chapter 7, pages 173-201, World Scientific Publishing Co. Pte. Ltd..
    7. Takauchi, Kazuhiro, 2015. "Endogenous transport price and international R&D rivalry," Economic Modelling, Elsevier, vol. 46(C), pages 36-43.
    8. Peter W. Wright & Paulo Bastos, 2012. "Exchange Rates and Wages in Unionized Labor Markets," ILR Review, Cornell University, ILR School, vol. 65(4), pages 975-999, October.
    9. Maiti, Dibyendu & Mukherjee, Arijit, 2013. "Trade cost reduction, subcontracting and unionised wage," Labour Economics, Elsevier, vol. 21(C), pages 103-110.
    10. Mukherjee, Arijit, 2013. "Endogenous domestic market structure and the effects of a trade cost reduction in a unionised industry," Economic Modelling, Elsevier, vol. 32(C), pages 30-33.

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