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Is corporatism feasible?

Nicola Acocella and Giovanni Di Bartolomeo ()

Macroeconomics from University Library of Munich, Germany

Abstract: This paper investigates the effects of cooperation (corporatism) on macroeconomic performance by considering a rather standard policy game between the government and a monopoly union. We stress the shortcomings of the traditional way used to model cooperation in policy games (the maximization of the weighted sum of players’ preferences), which only approximates the Nash product solution. We find that it is difficult to implement corporatism, although it generally increases social welfare, since it often reduces the union’s utility. In particular, we show that an inflation-neutral union will never find it profitable to cooperate with the government, unless side-payments are considered. The study of this issue is however beyond the scope of this paper.

Keywords: Employment; inflation; trade unions; government; corporatism; policy game; feasibility. (search for similar items in EconPapers)
JEL-codes: E24 E61 E31 E58 J51 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-mac
Date: 2005-04-26
Note: Type of Document - pdf; pages: 21. Revised version of the WP.
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Journal Article: IS CORPORATISM FEASIBLE? (2007) Downloads
Working Paper: Is corporatism feasible? (2003) Downloads
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