Flexibility in wage setting under the threat of relocation

Arbeitspapier

Relocation of production to countries with low labour cost have induced increased labour market flexibility, which has been praised as a silver bullet for economic growth and low unemployment. Within a unionised oligopoly framework, in which a multi-national firm has the option to relocate its production to a foreign country, we analyse the welfare implications of both centralised and flexible wage setting regimes. For very low foreign wages, wage flexibility leads to higher welfare than a rigid centralised regime. In contrast, for 'intermediate' wage levels in the foreign country, an industry-wide uniform wage leads to higher social welfare than flexible wages.

Angaben zum Objekt

• ISBN: 978-3-86304-268-4
• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: DICE Discussion Paper ; No. 269

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Multinational Firms; International Business ; Trade Unions: Objectives, Structure, and Effects ; Oligopoly and Other Imperfect Markets
• Thema: Union ; Centralised Wage ; Wage Flexibility ; Relocation ; Labour Market Flexibility

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Goeddeke, Anna ; Haucap, Justus ; Herr, Annika ; Wey, Christian
• Ereignis: Veröffentlichung
• (wer): Heinrich Heine University Düsseldorf, Düsseldorf Institute for Competition Economics (DICE)
• (wo): Düsseldorf
• (wann): 2017

Weitere Informationen

• Handle: http://hdl.handle.net/10419/168580
• Letzte Aktualisierung: 10.03.2025, 11:43 MEZ