Open Shop Unions and Product Market Competition

University of Nottingham Research Paper No. 2006/15

28 Pages Posted: 31 May 2006

See all articles by Paulo Bastos

Paulo Bastos

Technical University of Lisbon (UTL) - Research Unit on Complexity and Economics (UECE); ISEG Lisbon School of Economics and Management,Universidade de Lisboa

Udo Kreickemeier

University of Tuebingen; CESifo (Center for Economic Studies and Ifo Institute); University of Goettingen (Göttingen) - Faculty of Economics and Business Administration

Peter W Wright

University of Sheffield - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: May 2006

Abstract

In this paper we analyse the impact of changes in product market competition on wage outcomes in the presence of an open shop union. With less than full union membership, product market competition is shown to affect not only a unionised firm's profits but also its payoff in the event of a dispute. In contrast to the prediction of the standard model, increases in product market competition may now increase wage levels. The model is therefore able to accommodate the mixed empirical findings regarding the impact of product market competition on union wages.

Keywords: Bargaining, open shop trade unions, product market competition

JEL Classification: J51, J52, L13

Suggested Citation

Bastos, Paulo and Kreickemeier, Udo and Wright, Peter W, Open Shop Unions and Product Market Competition (May 2006). University of Nottingham Research Paper No. 2006/15, Available at SSRN: https://ssrn.com/abstract=905243 or http://dx.doi.org/10.2139/ssrn.905243

Paulo Bastos (Contact Author)

Technical University of Lisbon (UTL) - Research Unit on Complexity and Economics (UECE) ( email )

Rua Miguel Lupi, 20
Lisboa, 1200-781
Portugal

ISEG Lisbon School of Economics and Management,Universidade de Lisboa ( email )

Rua do Quelhas 6
LISBOA, 1200-781
Portugal

Udo Kreickemeier

University of Tuebingen ( email )

DE-72074 Tubingen
Germany

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

University of Goettingen (Göttingen) - Faculty of Economics and Business Administration ( email )

Platz der Goettinger Sieben 3
Goettingen, 37073
Germany

Peter W Wright

University of Sheffield - Department of Economics ( email )

9 Mappin Street
Sheffield, S1 4DT
UNITED KINGDOM

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