TY - JOUR
T1 - The effect of globalization on union bargaining and price-cost margins of firms
AU - Abraham, Filip
AU - Konings, Jozef
AU - Vanormelingen, Stijn
N1 - Funding Information:
Acknowledgment We would like to thank Italo Colantone, Jan De Loecker, Sabien Dobbelaere, James Hartigan, Jacques Mairesse, Damiaan Persyn, Raf Wouters and researchers of the National Bank of Belgium for helpful comments and suggestions. The research was financed by a grant of the National Bank of Belgium. This paper has benefited from presentations at the National Bank of Belgium, ETSG conference 2006, EARIE conference 2006, LICOS ITD seminar series and the doctoral workshop at UniversitéCatholique de Louvain-la-Neuve.
PY - 2009/4
Y1 - 2009/4
N2 - In recent years, Europe has witnessed an accelerated process of economic integration. This paper analyzes how increased economic integration has affected labor and product markets. We use a panel of Belgian manufacturing firms to estimate price-cost margins and union bargaining power and show how various measures of globalization affect them. Import competition puts pressure on both markups and union bargaining power, especially when there is increased competition from low wage countries. This suggests that increased globalization is associated with a moderation of wage claims in unionized countries, which should be associated with positive effects on employment.
AB - In recent years, Europe has witnessed an accelerated process of economic integration. This paper analyzes how increased economic integration has affected labor and product markets. We use a panel of Belgian manufacturing firms to estimate price-cost margins and union bargaining power and show how various measures of globalization affect them. Import competition puts pressure on both markups and union bargaining power, especially when there is increased competition from low wage countries. This suggests that increased globalization is associated with a moderation of wage claims in unionized countries, which should be associated with positive effects on employment.
KW - International trade
KW - Markups
KW - Trade unions
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U2 - 10.1007/s10290-009-0003-8
DO - 10.1007/s10290-009-0003-8
M3 - Article
AN - SCOPUS:64849084360
VL - 145
SP - 13
EP - 36
JO - Review of World Economics
JF - Review of World Economics
SN - 1610-2878
IS - 1
ER -