This paper considers the efficacy and the desirability of home government tariff and subsidy policies when labour market structure and asymmetries in the firms' size matter. In a Cournot-Nash duopolistic sector, a unionized home-firm competes against a non-unionized foreign firm. The home firm-union choose wages and employment in a two-stage Nash bargaining game. The second stage corresponds to the Cournot-Nash game with the foreign firm. Firms may play in strategic substitutes or complements. As the home bargainers recognize that market shares are determined by relative marginal costs, they may use the wage stage strategically. Home government policy choices critically depend upon the bargaining structure and general equilibrium spillovers.

Union-oligopoly sequential bargaining: Trade and industrial policies / M. Santoni. - In: OXFORD ECONOMIC PAPERS. - ISSN 0030-7653. - 48:4(1996 Oct 01), pp. 640-663. ((Intervento presentato al convegno Warwick Summer School on the New Macroeconomics tenutosi a Warwick (UK) nel 1993 [10.1093/oxfordjournals.oep.a028589].

Union-oligopoly sequential bargaining: Trade and industrial policies

M. Santoni
1996-10-01

Abstract

This paper considers the efficacy and the desirability of home government tariff and subsidy policies when labour market structure and asymmetries in the firms' size matter. In a Cournot-Nash duopolistic sector, a unionized home-firm competes against a non-unionized foreign firm. The home firm-union choose wages and employment in a two-stage Nash bargaining game. The second stage corresponds to the Cournot-Nash game with the foreign firm. Firms may play in strategic substitutes or complements. As the home bargainers recognize that market shares are determined by relative marginal costs, they may use the wage stage strategically. Home government policy choices critically depend upon the bargaining structure and general equilibrium spillovers.
Trade policy, industrial policy, unionised international oligopoly
Settore SECS-P/03 - Scienza delle Finanze
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Utilizza questo identificativo per citare o creare un link a questo documento: http://hdl.handle.net/2434/892299
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