Foreign direct investment (FDI) has grown far more rapidly than trade during the last two decades. As with the other prominent features of globalization, FDI is controversial. The impact of FDI on labour markets has been of growing concern, in particular for source countries. The deterioration...

The paper develops a simple political-economy model of unemployment benefit determination in a small open economy characterized by bargaining between firms and unions. The authors derive a number of comparative static results and present empirical results for a panel of OECD countries that are...