Endogenous Contracts in Unionized Oligopoly
We study the endogenous determination of contracts in a unionized oligopoly and the welfare implications thereof. Alternative contracts specify the sequencing in the selection of R&D and wages. They can be classified as 'fixed' when the unions set wages before the firms make their R&D decisions or 'floating' when the sequencing of these choices is reversed. If the unions are highly employment-oriented, we find that either all firm-union pairs choose floating-wage contracts or both contract types may coexist depending on the degree of technological spillovers. However, when the unions have stronger preference over attaining a good wage deal, then it becomes very likely that fixed-wage contracts will endogenously emerge because they can serve as an insurance device against oppor tunistic wage increases. Our welfare analysis suggests that welfare-improving contracts may nevertheless not always arise in equilibrium. Copyright 2009 CEIS, Fondazione Giacomo Brodolini and Blackwell Publishing Ltd.
Year of publication: |
2009
|
---|---|
Authors: | Kesavayuth, Dusanee ; Zikos, Vasileios |
Published in: |
LABOUR. - Centro di Studi Internazionali Sull'Economia e la Sviluppo (CEIS). - Vol. 23.2009, 2, p. 209-235
|
Publisher: |
Centro di Studi Internazionali Sull'Economia e la Sviluppo (CEIS) |
Saved in:
freely available
Saved in favorites
Similar items by person
-
Personality and health satisfaction
Kesavayuth, Dusanee, (2015)
-
Zikos, Vasileios, (2010)
-
Does Personality Affect how People Perceive their Health?
Kesavayuth, Dusanee, (2013)
- More ...