IDEAS home Printed from https://ideas.repec.org/a/mhr/jinste/urnsici0932-4569(200809)1643_509otioce_2.0.tx_2-p.html
   My bibliography  Save this article

On the Internalization of Cross-National Externalities through Political Markets: The Case of Labour Standards

Author

Listed:
  • Toke S. Aidt
  • Uk Hwang

Abstract

Can lobbying internalize cross-national externalities? This paper investigates this in a two-country economy where governments regulate labour markets through national labour standards, but are subject to lobbying. We study four different lobbying architectures and show that cross-national externalities are fully internalized in two cases: (i) when governments enter binding international agreements and (ii) when international lobbying is complete. In cases where international lobbying is incomplete, e.g., because of disagreement among lobby groups in different countries or direct bans on lobbying of foreign governments, internalization is also incomplete and a role remains for governments to enter into binding agreements.

Suggested Citation

  • Toke S. Aidt & Uk Hwang, 2008. "On the Internalization of Cross-National Externalities through Political Markets: The Case of Labour Standards," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 164(3), pages 509-533, September.
    • Handle: RePEc:mhr:jinste:urn:sici:0932-4569(200809)164:3_509:otioce_2.0.tx_2-p
    as

    Download full text from publisher

    File URL: https://www.mohrsiebeck.com/en/article/on-the-internalization-of-cross-national-externalities-through-political-markets-the-case-of-labour-standards-101628093245608785363380
    Download Restriction: Fulltext access is included for subscribers to the printed version.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Toke S. Aidt & Facundo Albornoz & Esther Hauk, 2019. "Foreign in influence and domestic policy: A survey," Cambridge Working Papers in Economics 1928, Faculty of Economics, University of Cambridge.
    2. Ensthaler, Ludwig & Huck, Steffen & Leutgeb, Johannes, 2020. "Games played through agents in the laboratory — a test of Prat & Rustichini's model," Games and Economic Behavior, Elsevier, vol. 119(C), pages 30-55.
    3. Aidt, Toke S. & Albornoz, Facundo & Gassebner, Martin, 2018. "The golden hello and political transitions," Journal of Comparative Economics, Elsevier, vol. 46(1), pages 157-173.
    4. Antràs, Pol & Padró i Miquel, Gerard, 2011. "Foreign influence and welfare," Journal of International Economics, Elsevier, vol. 84(2), pages 135-148, July.
    5. Toke S. Aidt & Uk Hwang, 2014. "To Ban or Not to Ban: Foreign Lobbying and Cross-National Externalities," Canadian Journal of Economics, Canadian Economics Association, vol. 47(1), pages 272-297, February.
    6. Persson, Lars, 2012. "Environmental policy and lobbying in small open economies," Resource and Energy Economics, Elsevier, vol. 34(1), pages 24-35.
    7. Albornoz, Facundo & Hauk, Esther, 2014. "Civil war and U.S. foreign influence," Journal of Development Economics, Elsevier, vol. 110(C), pages 64-78.
    8. Bontems, Philippe & Cheikbossian, Guillaume & Hafidi, Houda, 2024. "Environmental Tax Competition and Welfare: The Good News about Lobbies," TSE Working Papers 24-1551, Toulouse School of Economics (TSE).
    9. Jie Ma, 2017. "Double-edged incentive competition for foreign direct investment," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 24(2), pages 282-312, April.
    10. Aidt, Toke S. & Albornoz, Facundo, 2011. "Political regimes and foreign intervention," Journal of Development Economics, Elsevier, vol. 94(2), pages 192-201, March.
    11. Toke S. Aidt & Facundo Albornoz & Esther Hauk, 2021. "Foreign Influence and Domestic Policy," Journal of Economic Literature, American Economic Association, vol. 59(2), pages 426-487, June.
    12. Ilias Boultzis, 2020. "Truthful Equilibria in Generalized Common Agency Models," Papers 2007.15942, arXiv.org.
    13. Aidt, T.S. & Hwang, U., 2008. "One Cheer for Foreign Lobbying," Cambridge Working Papers in Economics 0860, Faculty of Economics, University of Cambridge.
    14. Josip Lesica, 2018. "Lobbying For Minimum Wages," Economic Inquiry, Western Economic Association International, vol. 56(4), pages 2027-2057, October.
    15. Peymaneh Safaynikoo & Mohammad Hossein Dehghani, 2021. "Impact of international lobby groups on international environmental agreements," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 23(2), pages 441-466, April.

    More about this item

    JEL classification:

    • J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
    • J8 - Labor and Demographic Economics - - Labor Standards
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:mhr:jinste:urn:sici:0932-4569(200809)164:3_509:otioce_2.0.tx_2-p. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Thomas Wolpert (email available below). General contact details of provider: https://www.mohrsiebeck.com/jite .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.