We analyse a world consisting of "the North" and "the South" where labour standards in the North are set by trade unions. Standards set by unions tend to increase output and welfare. There are no unions in the South and work standards are suboptimal. Trade between these two countries can imply a...

Historically, worker movements have played a crucial role in making workplaces safer. Firms traditionally oppose better health standards. According to our interpretation, workplace safety is costly for .firms but increases average health of workers and thereby aggregate labour supply. A...

The paper develops a theory of the firm’s capital-labor ratio unionization of its labor force. Using explicit game theoretical solutions to union-firm bargaining, it is demonstrated how the firm’s product market power interacts with the inputs allocation rule in such a way that unionism...

This note reconsiders the problem of managerial incentives in the context of an unionized Nash-Cournot oligopoly. It is hightlighted that managerial incentives weaken union power at industry equilibrium, although, as a symptom of a prisoner dilemma, unions are not reluctant to the existence of...

This paper applies a production function approach to the analysis of imperfections in output and factor markets and develops a test of efficient bargaining for wage and employment determination. Based on a translog function defined at the firm level, estimates for the Belgian chemical industry...

The paper analyses the consequence of introducing (decentralized) union-firm bargaining in the theory of the firm under uncertainty. Contrary to earlier beliefs that short-run output does not change with additive uncertainty, it is shown that risk preference may matter when union-firm bargaining...

This paper analyses the role played by a social security system in union-firm bargaining and in the resulting wage-productivity spiral. In a first step, we derive the incidence of social security on the bargaining process itself. In a second step, the macromodel is extended to include the budget...