Foreign Direct Investment, Labour Unions, and Self-interested Governments
نویسنده
چکیده
This document examines foreign direct investment (FDI) when multinationals and labour unions bargain over labour contracts and lobby the self-interested government for taxation and labour market regulation. It is shown that FDI is best protected from expropriation in unionized economies with right-to-manage bargaining, not bargaining over wages and employment. When the labour market is nonunionized or when there is bargaining over wages and employment, the ruling elite can use taxation or labour market regulation as a nondistorting vehicle to expropriate the surplus of FDI. Journal of Economic Literature: F21, F23, J51, D78
منابع مشابه
Globalisation and Labour Markets Research Paper 2004 / 19 Union Bargaining Power , Labour Standards and Foreign Direct Investment
This paper examines Foreign Direct Investment in the presence of labour unions. An oligopoly model is developed in which identical firms locate in a host country in order to export to a foreign country. These firms are unionised and compete with foreign firms on the foreign market. We consider the incentives for social dumping via restrictive labour legislation which we assume can be used by th...
متن کاملUnion Bargaining Power, Labour Standards and Foreign Direct Investment
This paper examines Foreign Direct Investment in the presence of labour unions. An oligopoly model is developed in which identical firms locate in a host country in order to export to a foreign country. These firms are unionised and compete with foreign firms on the foreign market. We consider the incentives for social dumping via restrictive labour legislation which we assume can be used by th...
متن کاملThe Interactive Relationship between Regional Trade Integration and Foreign Direct Investment
E conomic integration among countries has continued to deepen over the past decade. This is especially visible at the regional level, with the escalation of Regional Integration Agreements (RIAs) ranging from Free Trade Areas (FTAs) to Customs Unions (CUs). Nowadays, many developing countries have entered a new regional integration agreement with developed and developing countries. S...
متن کاملForeign Direct Investment, Black Economic Empowerment and Labour Productivity in South Africa
Foreign Direct Investment, Black Economic Empowerment and Labour Productivity in South Africa The impact of foreign direct investment (FDI) on domestically owned firms in developing countries has been widely debated in the literature. It has been argued that FDI provides access to advanced technologies and other intangible assets which may spill over to the host country and allow domestic firms...
متن کاملGlobalization, FDI and employment in Viet Nam
The article considers the impact of foreign direct investment on employment in Viet Nam, a country that received considerable inflows of foreign capital in the 1990s as part of its increased integration with the global economy. Despite the significant share of foreign firms in industrial output and exports, the direct employment generated has been very limited because of the high labour product...
متن کامل