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The paper introduces a model of enterprise formation in a unionized economy with labor protection and wage bargaining. Enterprise formation is subject to future market risk and is shaped by labor market institutions in the post-entry stage. The predictions of the model are tested in...
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Previous papers modeling the interaction between the central bank and a single monopoly union demonstrated that greater monetary policy uncertainty reduces the union's nominal wage. This paper shows that this result does not hold in general, since it depends on peculiar specifications of the...
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