Rent Sharing with Footloose Production. Foreign Ownership and Wages Revisited

Ragnhild Balsvik and Morten Sæthre

No 30/2014, Discussion Paper Series in Economics from Norwegian School of Economics, Department of Economics

Abstract: We present a bargaining model of wage and employment determination, where we show that foreign acquisitions might hurt the bargaining outcome of powerful unions by giving the fi rm a credible threat to move production abroad. Using detailed data on fi rms and workers in manufacturing, including information on union membership and foreign ownership, we fi nd, in line with the predictions of our model, that foreign acquisitions negatively impact the outcome of workers in highly unionized plants.

Keywords: Foreign acquisitions; trade unions; wages. (search for similar items in EconPapers)
JEL-codes: F23 J30 J51 (search for similar items in EconPapers)
Pages: 28 pages
Date: 2014-09-16
New Economics Papers: this item is included in nep-int and nep-lab
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Citations: View citations in EconPapers (14)

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