Profit-sharing, Bertrand Competition and Monopoly Unions: a Note
نویسندگان
چکیده
This paper studies a strategic aspect of pro t-sharing in an oligopolistic industry with a monopoly union. Whenever a uniform pro t share exists in the industry, we show that a union that values the per worker remuneration positively, may have incentives to reduce industry employment, decreasing thus total output and causing total pro ts to increase. Thus, we show that pro t-sharing may lead to higher pro ts for such an industry even if productivity e ects are absent.(JEL L42, J33, J51) Address for correspondence: Department of Economics, University of Warwick, Coventry CV4 7AL, U.K. tel.:(441)-24-76-523056. FAX:(441)-24-76-523032. Email:[email protected].
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