This paper investigates the efficiency implications of two kinds of worker protection, namely job security and income protection. Both of them have important aggregate efficiency effects in the dynamic labour markets, where worker mobility is costly. In the absence of firing costs, income...

This paper studies implications of centralised wage setting for the level of taxation and public expenditure in an analytical model with unionised labour markets. We extend the previous studies by allowing for both demand and supply effects of labour. Also, in addition to the standard social...