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Title:Unionisation structures and heterogeneous firms PDF Logo
Authors:Braun, Sebastian
Issue Date:2009
Series/Report no.:Kiel working paper 1566
Abstract:The effects of unions on productivity and firm performance have been the topic of extensive research. Existing studies have, however, primarily focused on firm-level bargaining and on markets that are characterised by a small and fixed number of identical firms. This paper studies how different unionisation structures affect firm productivity and firm performance in a monopolistic competition model with heterogeneous firms and free entry. While centralised bargaining induces tougher selection among heterogeneous producers and thus increases average productivity, firm-level bargaining allows less productive entrants to remain in the market. Centralised bargaining also results in higher average output and profit levels than either decentralised bargaining or a competitive labour market. From the perspective of consumers, the choice between centralised and decentralised bargaining involves a potential trade-off between product variety and product prices.
Subjects:Trade unions
heterogeneous firms
productivity
firm performance
JEL:J24
J50
D43
Document Type:Working Paper
Appears in Collections:Publikationen von Forscherinnen und Forschern des IfW
Kieler Arbeitspapiere, IfW

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