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| Author: | Munch, J.R. |
| Title: | The location of firms in unionized countries |
| Journal: | Scandinavian Journal of Economics
2003 : VOL. 105:1, p. 49-71 |
| Index terms: | Economic geography Integration International relations Trade unions |
| Freeterms: | Agglomeration |
| Language: | eng |
| Abstract: | This paper develops a two-country economic geography model with Cournot competition, where the labor markets are unionized so that trade unions bargain efficiently with each firm over wages and employment. Agglomeration forces are present due to wage premia obtained by the trade unions. It is shown that if the bargaining power of unions differs across countries then, as trade costs are reduced, the country with relatively weak unions gradually acquires all firms. |
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