Unionization, vertical markets, and the outsourcing of multinationals

• 成果类型: Article
• 署名作者: Zhao, LX
• 署名单位: Hokkaido University
• 刊物名称: JOURNAL OF INTERNATIONAL ECONOMICS
• ISSN/ISSBN: 0022-1996
• DOI: 10.1016/S0022-1996(01)00090-3
• 发表日期: 2001
• 页码: 187-202
• 关键词: Labor unions; multinational firms; Outsourcing; vertical integration

摘要

This paper offers an explanation for multinationals that are both horizontally and vertically related. Specifically, when labor is unionized, the conventional incentives for merger may disappear in industries of successive (or bilateral) monopoly, due to 'double marginalization', which limits the amount of surplus that can be bargained between labor and the firms. We show that vertical integration raises both union employment and the negotiated wage, but may reduce total industry profits. As such, the integrated firm has incentives to outsource - to go multinational, regardless of whether the foreign country is unionized or not. We demonstrate that the negotiated wage decreases and firm profits increase with outsourcing. Thus, unionization in vertically related markets can make firms become multinational conglomerates that are both vertically and horizontally related. (C) 2001 Elsevier Science B.V. All rights reserved.