In this paper we analyze the private and public incentives towards skill acquisition when the skill level of workers determines the quality level of goods, and both labor and product markets are non competitive. We delve into the mechanisms that determine the equilibrium skill acquisition...

This paper sets up an endogenous growth model with monopolistic competition in the product market and efficient bargaining in the labor market, and uses it to examine the impacts of union power, monopoly power and tax policy on the long-run economic growth rate. Some main findings emerge from...

We show the effects of trade cost reduction in the presence of a domestic firm's strategic output allocation between formal in-house production and subcontracting to the informal sector. Considering a one-way trade, we show that trade cost reduction increases the in-house unionised wage,...

La literatura que analiza el efecto de la inversión directa extranjera ha estudiado, principalmente, la repercusión que tiene sobre el bienestar social de un país la localización en él de una empresa. En este artículo, por el contrario, analizamos cómo se ve afectado el bienestar social...

This article appraises the effects of trade liberalization between two industries that have different endowments of skilled labor. Skilled labor is necessary for the production of higher-quality variants of a vertically differentiated good. Skilled labor endowments, therefore, determine the...

The literature on foreign direct investment has analyzed firms٠location decisions when they invest in R&D to reduce production costs. Such firms may set up new plants in other developed countries while maintaining their domestic plants. In contrast, here we consider firms that close down their...

We find that trade unions have a rational incentive to oppose the adaption of labour-saving technology when labour demand is inelastic and unions care much for employment relative to wages. Trade liberalisation typically increases trade union technology opposition. These conclusions are reached...

We examine how a downstream merger affects input prices and, in turn, the profitability of such a merger under Cournot competition with differentiated products. Input suppliers can be interpreted as ordinary upstream firms, or trade unions organising workers. If the input suppliers are...

We analyse how equilibrium locations in location-price games à la Hotelling are affected when firms acquire inputs through bilateral monopoly relations with suppliers. Assuming a duopoly downstream market, we consider the case of two independent input suppliers bargaining with both downstream...

We analyse how the presence of trade unions affects the pattern of mergers in an international oligopoly and the welfare implications thereof. We find that an international merger results in lower wages for all firms. A national merger results in higher wages, highest for the non-merging firms....