Union power and product market competition: evidence from the airline industry
In this paper we specify and estimate a structural model which links product market competition and union power. The model has a two-stage setting in which wages are determined through bargaining between management and unions in the first stage, with a price-setting market game to follow in the second stage. Using data for eight European airlines from 1976-1994, we provide evidence on price-cost margins and the measurement of market power in a model of rent sharing. In particular, we find that the welfare effects of rent sharing work mainly through reducing firms’ profits, rather than consumers surplus. As a consequence the static impact of unions is more on equity rather than efficiency.
Year of publication: |
1997
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Authors: | Neven, Damien J. ; Röller, Lars-Hendrik ; Zhang, Zhentang |
Publisher: |
Berlin : Wissenschaftszentrum Berlin für Sozialforschung (WZB) |
Saved in:
freely available
Series: | WZB Discussion Paper ; FS IV 97-38 |
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Type of publication: | Book / Working Paper |
Type of publication (narrower categories): | Working Paper |
Language: | English |
Other identifiers: | hdl:10419/50971 [Handle] |
Source: |
Persistent link: https://www.econbiz.de/10010278065
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