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Integration of Product Markets when Labour Markets are Unionized

Published online by Cambridge University Press:  17 August 2016

Jan Rose Sørensen
Jan Rose Sørensen*
Affiliation:
University of Aarhus
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Summary

This paper is a first attempt to analyse the consequences of establishing the internal market when taking account of labour market effects of product market integration. Our main focus is on market power, and we show that both labour unions and firms may lose market power when product markets become integrated. If this happens, it is likely that both workers and capitalists become better off. On the other hand, if the firms reestablish their market power through mergers or cooperation, capitalists gain, whereas workers lose. If neither firms nor unions lose market power, there are no effects of integration.

Résumé

Résumé

Cet article est une première tentative d'analyser les conséquences de l'établissement d'un marché interne, lorsqu'on prend en compte les effets sur le marché du travail de l'intégration du marché du produit. L'essentiel de l'analyse touche au pouvoir de marché. On montre que a la fois les syndicats de travailleurs et les entreprises peuvent perdre leur pouvoir de marché lorsque les marchés du produit deviennent intégrés. Si c'est le cas, il est probable que à la fois les travailleurs et les capitalistes s'en trouvent mieux lotis. Par contre, si les entreprises restaurent leur pouvoir de marché via des fusions ou la coopération, les capitalistes y gagnent mais pas les travailleurs. Enfin, si ni les entreprises ni les syndicats ne perdent leur pouvoir de marché, l'intégration n'a pas d'impact.

Keywords

F15J51L19F15J51L19
Type
Research Article
Information
Recherches Économiques de Louvain/ Louvain Economic Review , Volume 59 , Issue 4 , 1993 , pp. 485 - 502
Copyright
Copyright © Université catholique de Louvain, Institut de recherches économiques et sociales 1993 

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Footnotes

*

I would like to thank Henrik Jensen and two anonymous referees for useful comments. I am also gratefull for comments made by participants at a CIE seminar.

References

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