Union Wage Bargaining and European Antidumping Policy in Imperfectly Competitive Markets

CEPR Discussion Paper Series Number 1860

Posted: 23 Jul 1998

See all articles by Jozef Konings

Jozef Konings

Catholic University of Leuven (KUL) - LICOS - Centrum voor Transitie-economie; Centre for Economic Policy Research (CEPR); IZA Institute of Labor Economics

Hylke Vandenbussche

Catholic University of Leuven (KUL), CEPR

Reinhilde Veugelers

Catholic University of Leuven (KUL) - Department of Applied Economics; Centre for Economic Policy Research (CEPR)

Date Written: April 1998

Abstract

The purpose of this paper is to analyse the interaction between union bargaining power and the likelihood and type of European antidumping measures (duties and undertakings) in imperfectly competitive product markets. We present a simple theoretical model which is well embedded in EU legal practice, to show that cost asymmetries, induced by union wage bargaining in a European firm, lead to an increase in both the likelihood and the level of antidumping protection against foreign imports of a similar product. In addition, our results indicate that a cost asymmetry, in the form of a unionized wage differential, alters the relative probability of a duty versus an undertaking. We show that the size of these effects depends on the intensity of product market competition. In a further step, we use Belgian firm level micro-data to provide some evidence for our predictions.

JEL Classification: C72, D43, F13, J51

Suggested Citation

Konings, Jozef and Vandenbussche, Hylke and Veugelers, Reinhilde, Union Wage Bargaining and European Antidumping Policy in Imperfectly Competitive Markets (April 1998). CEPR Discussion Paper Series Number 1860. Available at SSRN: https://ssrn.com/abstract=108188

Jozef Konings (Contact Author)

Catholic University of Leuven (KUL) - LICOS - Centrum voor Transitie-economie ( email )

Waaistraat 6 - box 3511
Leuven, 3000
Belgium
+32 16 326 589 (Phone)
+32 16 326 599 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Hylke Vandenbussche

Catholic University of Leuven (KUL), CEPR ( email )

Faculty of Economics
Naamsestraat 69
B-3000 Leuven, 3000
Belgium
+32 16 326 920 (Phone)
+32 16 326 732 (Fax)

HOME PAGE: https://www.sites.google.com/site/vandenbusschehylke/home-1

Reinhilde Veugelers

Catholic University of Leuven (KUL) - Department of Applied Economics ( email )

Leuven, B-3000
Belgium
+32 16 32 6908 (Phone)
+32 16 32 6732 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

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