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Do Trade Unions Deteriorate International Competitiveness? Reconciliation of the Discrepancy Between Theory and Practice

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  • Chi-Hsin Wu
  • Chia-Ying Liu

Abstract

Brander and Spencer (Journal of International Economics 24:217–234, 1988 ) and Mezzetti and Dinopoulos (Journal of International Economics 31:79–100, 1991 ) provide different theoretical viewpoints on the following issue: Do trade unions deteriorate international competitiveness? Some discrepancies have been found to exist between their arguments and empirical findings. This paper attempts to provide plausible explanations and solutions to reconcile these discrepancies. Copyright International Atlantic Economic Society 2010

Suggested Citation

  • Chi-Hsin Wu & Chia-Ying Liu, 2010. "Do Trade Unions Deteriorate International Competitiveness? Reconciliation of the Discrepancy Between Theory and Practice," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 38(2), pages 145-155, June.
    • Handle: RePEc:kap:atlecj:v:38:y:2010:i:2:p:145-155
    DOI: 10.1007/s11293-010-9222-6
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    References listed on IDEAS

    as
    1. Brander, James A. & Spencer, Barbara J., 1988. "Unionized oligopoly and international trade policy," Journal of International Economics, Elsevier, vol. 24(3-4), pages 217-234, May.
    2. Olivier Blanchard & Francesco Giavazzi, 2003. "Macroeconomic Effects of Regulation and Deregulation in Goods and Labor Markets," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 118(3), pages 879-907.
    3. Oswald, A. J., 1995. "Efficient contracts are on the labour demand curve: Theory and facts," Labour Economics, Elsevier, vol. 2(1), pages 102-102, March.
    4. Dowrick, Steve, 1985. "Why employees Prefer not to Bargain over Jobs," The Warwick Economics Research Paper Series (TWERPS) 264, University of Warwick, Department of Economics.
    5. Booth,Alison L., 1994. "The Economics of the Trade Union," Cambridge Books, Cambridge University Press, number 9780521468398.
    6. Mezzetti, Claudio & Dinopoulos, Elias, 1991. "Domestic unionization and import competition," Journal of International Economics, Elsevier, vol. 31(1-2), pages 79-100, August.
    7. Timothy C.G. Fisher & Robert G. Waschik, 2000. "Union bargaining power, relative wages, and efficiency in Canada," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 33(3), pages 742-765, August.
    8. Jackman, R. & Layard, R. & Nickell, S., 1996. "Combatting unemployment: is flexibility enough?," LSE Research Online Documents on Economics 47446, London School of Economics and Political Science, LSE Library.
    9. repec:bla:econom:v:43:y:1976:i:171:p:267-74 is not listed on IDEAS
    10. Ellen R. Rissman, 1988. "Imports, trade policy, and union wage dynamics," Staff Memoranda 88-11, Federal Reserve Bank of Chicago.
    11. Haskel, Jonathan & Martin, Christopher, 1992. "Margins, concentration, unions and the business cycle : Theory and evidence for Britain," International Journal of Industrial Organization, Elsevier, vol. 10(4), pages 611-632, December.
    12. Bulkley, George & Myles, Gareth D., 1997. "Bargaining over effort," European Journal of Political Economy, Elsevier, vol. 13(2), pages 375-384, May.
    13. Ellen R. Rissman, 1989. "Trade policy and union wage dynamics," Working Paper Series, Macroeconomic Issues 89-19, Federal Reserve Bank of Chicago.
    14. Ashenfelter, Orley & Johnson, George E, 1969. "Bargaining Theory, Trade Unions, and Industrial Strike Activity," American Economic Review, American Economic Association, vol. 59(1), pages 35-49, March.
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    16. Manning, Alan, 1993. "Wage Bargaining and the Phillips Curve: The Identification and Specification of Aggregate Wage Equations," Economic Journal, Royal Economic Society, vol. 103(416), pages 98-118, January.
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    More about this item

    Keywords

    Unionization; Bargaining power; International trade; F12; J50;
    All these keywords.

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • J50 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - General

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