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Unionisation Structure and Outward Foreign Direct Investment

Arijit Mukherjee and Kullapat Suetrong

Journal of Institutional and Theoretical Economics (JITE), 2012, vol. 168, issue 2, 266-279

Abstract: We analyse the effects of the unionisation structure on the incentive for outward foreign direct investment (FDI) and on union utility. The incentive for outward FDI is higher under a centralised union than under decentralised unions, irrespective of the number of firms in the industry. If the number of firms undertaking FDI is higher under a centralised union than under decentralised unions, wages and the union utility can be higher under the latter unionisation structure, depending on the competitiveness of the industry. There may not be a conflict of interest between domestic labour union and domestic industry about the unionisation structure.

JEL-codes: F23 J51 (search for similar items in EconPapers)
Date: 2012
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