Wage Determination and Capital Decisions in a Dynamic Monopoly Union Model

Saqib Jafarey, Yannis Kaskarelis and Natasha Miaouli
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Saqib Jafarey: University of Essex, U.K.
Yannis Kaskarelis: University of Macadonia, Greece

Ekonomia, 1998, vol. 2, issue 1, 73-89

Abstract: This paper uses a dynamic monopoly union model to analyse the joint determination of wages, employment and investment in the absence of binding contracts. The union maximizes a utilitarian utility function while the firm faces a neoclassical investment problem with adjustment costs. Concentrating on noncommitment equilibria, we solve for Markov strategies. When the model is tested for Greek manufacturing during the period 1954-1993, the data do not reject the theoretical predictions.

JEL-codes: E62 J5 (search for similar items in EconPapers)
Date: 1998
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:ekn:ekonom:v:2:y:1998:i:1:p:73-89

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