This paper examines the welfare implications of an existence of free trade agreements (FTAs) and customs unions (CUs) in the GATT system, in the presence of cross-foreign ownership among countries. In particular, two GATT regimes are analyzed: a pure GATT regime without any regional free trade agreements, and modified GATT regime with either an FTA or a CU. This paper argues that, when foreign ...

Compensation systems such as individualized pay for performance (I-PFP) schemes for employees represent an important approach to aligning employer-employee interests. However, the adoption of I-PFP is much less common in many countries than in the USA. Employing a multi-level analysis of over 4,000 firms in 26 countries, we explore determinants of its adoption. At the country level we distingui...

Debates over America’s heavy reliance on employer-provided private pensions have understated the profound role organized labor played after World War II. Archival evidence from prominent unions and business associations suggests that the shift in organized labor’s strategy after the New Deal toward electoral activity helps explain critical interventions by Northern Democrats into the system of ...

This paper constructs a political equilibrium in which firms and unions bargain over wages and workers and capitalists lobby the government for taxation, labor market regulation and immigration policy. The main findings are the following. It is in the native workers’ interests to ban firms’ direct recruitment from abroad. Otherwise, the ruling elite captures the surplus of the labor unions by t...

Studies uniformly conclude that union wage effects are largest for work­ ers with low measured skills. Longitudinal analysis using 19891901994195 Current Population Survey matched panels produces union pre­ mium estimates equivalent across skill groups, following appropriate sam­ ple restrictions and control for worker-specific skills. Evidence from the National Longitudinal Survey of Youth on ...

This paper examines the impact of unions on unemployment and wages in a dynamic equilibrium search model. We model a union as imposing a minimum wage and rationing jobs to ensure that the union’s most senior members are employed. This generates rest unemployment, where following a downturn in their labor market, unionized workers are willing to wait for jobs to reappear rather than search for a...

We shall assume throughout that if is a class of structures (i.e., relational systems) that is elementary in the wider sense; that is, K is the class of all models of some finite or infinite set of sentences of the first order predicate logic with identity. A structure 23 is said to be a union of a set M of structures if each 21G M is a substructure of 23 and every element of 23 is an element o...

We examine the causal effect of unionization on firm innovation, using regression discontinuity design that relies on “locally” exogenous variation generated by elections that pass or fail by a small margin of votes. Passing a union election leads to an 8.7% (12.5%) decline in patent quantity (quality) three years post-election. A reduction in R&D expenditures, reduced productivity of inventors...