Abstract
This paper employs a simple overlapping gener
ations endogenous growth model with an R&D
sector to establish a link between union bargaining power, long-run unemployment and long-run
growth. The model consists of a competitive final goods sector, two intermediate goods sectors,
one competitive and the other a monopoly and a
competitive R&D sector. Increased union bargaining power in the monopolized intermediate-goods sector is shown to increase wages and unemployment in the sector and reduce the economy’s long-run growth rate. This result is shown to hold for both closed- and open-shop unions.
Original language | English |
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Commissioning body | Asia Pacific School of Economics and Government, ANU |
Publication status | Published - 2002 |