This paper examines the effect of monopolistic labour unions' behaviour on governments' incentives to undertake labour … inside the MU when governments and labour unions move simultaneously in the first stage of the policy game, which is … particular, when unions are powerful in the wage bargaining process …

This paper examines the effect of monopolistic labour unions' behavior on governments' incentives to undertake labour … inside the MU when governments and labour unions move simultaneously in the first stage of the policy game. Inside the MU … governments, only in the case of a symmetric MU and in particular when unions are powerful in wage setting. Area-wide reform is …

. The conventional logic attributes this problem to strong trade unions and other flaws in the labour market. This article … takes a different approach. Using a game theoretic model we look at the changes that occur if trade unions and the central … risk associated with employment expansion (if trade unions cooperate the risk pays off). Moreover, results change …

interplay of wage-setting unions and a central bank we show that although central banks may not gain more information by …