Union bargaining power, subcontracting and innovation

Research output: Journal Publications and Reviews (RGC: 21, 22, 62)21_Publication in refereed journalpeer-review

7 Scopus Citations
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Author(s)

  • Hamid Beladi
  • Arijit Mukherjee

Related Research Unit(s)

Detail(s)

Original languageEnglish
Pages (from-to)90-104
Journal / PublicationJournal of Economic Behavior and Organization
Volume137
Publication statusPublished - 1 May 2017

Abstract

We show that if a firm can subcontract production to an informal sector, an increase in union power may either increase or decrease innovation. An increase in union power makes the firm worse off irrespective of its effect on innovation. However, in contrast to the usual belief, an increase in union power may increase consumer surplus and decrease union utility by affecting innovation, thus suggesting that a union may not want to be too powerful. An increase in union power may create an ambiguous effect on social welfare. Our analysis provides new insights to the relation between union power and innovation.

Research Area(s)

  • Consumer surplus, Innovation, Subcontracting, Union

Citation Format(s)

Union bargaining power, subcontracting and innovation. / Beladi, Hamid; Mukherjee, Arijit.

In: Journal of Economic Behavior and Organization, Vol. 137, 01.05.2017, p. 90-104.

Research output: Journal Publications and Reviews (RGC: 21, 22, 62)21_Publication in refereed journalpeer-review