Theory of Semi-Collusion in the Labor Market

Pedro Gonzaga (), Antonio Brandao and Helder Vasconcelos
Additional contact information
Pedro Gonzaga: CEF.UP and Faculty of Economics of the University of Porto (FEP)

FEP Working Papers from Universidade do Porto, Faculdade de Economia do Porto

Abstract: We study the effects of cooperative wage setting in industries that use two different types of labor. In particular, we consider a two-stage game where firms hire non-specialized workers in a perfectly competitive labor market and specialized workers that are more productive and expensive, but whose wages can be cooperatively determined by firms. It is shown that semi-collusion leads to lower wages and employment of specialized labor, lower production levels and higher prices, due to the elimination of the business stealing effect, labor force stealing effect and as a result of a dynamic effect that is specific to semi-collusive games.

Keywords: Semi-collusion; labor market; oligopsony; business stealing effect; labor force stealing effect; price war effect; shooting the moon strategy. (search for similar items in EconPapers)
JEL-codes: L11 L13 L41 L44 (search for similar items in EconPapers)
Pages: 45 pages
Date: 2014-01
New Economics Papers: this item is included in nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.fep.up.pt/investigacao/workingpapers/wp522.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 404 Not Found (http://www.fep.up.pt/investigacao/workingpapers/wp522.pdf [302 Found]--> https://fep.up.pt/investigacao/workingpapers/wp522.pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:por:fepwps:522

Access Statistics for this paper

More papers in FEP Working Papers from Universidade do Porto, Faculdade de Economia do Porto Contact information at EDIRC.
Bibliographic data for series maintained by ().