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Cover of: Labor Unionization Structure, Innovation, and Welfare
Arijit Mukherjee, Tien-Der Han

Labor Unionization Structure, Innovation, and Welfare

Section: Articles
Volume 173 (2017) / Issue 2, pp. 279-300 (22)
Published 09.07.2018
DOI 10.1628/093245616X14785139493983
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  • 10.1628/093245616X14785139493983
Summary
We show the effects of cooperation among the labor unions with complementary workers on innovation, consumer surplus, and welfare. Although cooperation among the unions reduces wages, it may either increase or decrease the firm's incentive for innovation, and may also make the consumers and the society worse off by reducing innovation. While cooperation (compared to noncooperation) among the unions makes the workers better off, it may not make all final-goods producers better off.