Wage bargaining and quality competition

Ranajoy Bhattacharyya and Bibhas Saha

MPRA Paper from University Library of Munich, Germany

Abstract: In a standard model of vertical differentiation, wage is assumed to determine the quality. Wage is also subject to bargaining. Increased bargaining power of the worker in the low quality firm reduces quality differential, and increases price competitiveness. The Opposite happens from a similar change in the high quality firm.

Keywords: Wage bargaining; Quality competition (search for similar items in EconPapers)
JEL-codes: C7 (search for similar items in EconPapers)
Date: 2011-05-20
New Economics Papers: this item is included in nep-bec, nep-com, nep-gth and nep-lab
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:30968

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