The effect of globalization on union bargaining and price-cost margins of firms

Filip Abraham, Jozef Konings, Stijn Vanormelingen

Research output: Contribution to journalArticle

37 Citations (Scopus)

Abstract

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.

Original languageEnglish
Pages (from-to)13-36
Number of pages24
JournalReview of World Economics
Volume145
Issue number1
DOIs
Publication statusPublished - Apr 2009
Externally publishedYes

Fingerprint

Bargaining power
Price-cost margin
Wages
Globalization
Economic integration
Moderation
Manufacturing firms
Import competition
Labour market
Product market
Markups

Keywords

  • International trade
  • Markups
  • Trade unions

ASJC Scopus subject areas

  • Economics, Econometrics and Finance(all)

Cite this

The effect of globalization on union bargaining and price-cost margins of firms. / Abraham, Filip; Konings, Jozef; Vanormelingen, Stijn.

In: Review of World Economics, Vol. 145, No. 1, 04.2009, p. 13-36.

Research output: Contribution to journalArticle

Abraham, Filip ; Konings, Jozef ; Vanormelingen, Stijn. / The effect of globalization on union bargaining and price-cost margins of firms. In: Review of World Economics. 2009 ; Vol. 145, No. 1. pp. 13-36.
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