International Economics and Economic Policy

, Volume 13, Issue 2, pp 223–232 | Cite as

The labor market effects of trade unions in an open economy: Layard meets Melitz

Original Paper

Abstract

Trade unions are typically able to convert their industrial power into political power. We show that, depending on the constellation of parameters, stronger trade unions may improve welfare in terms of an increase in aggregate employment and output if they successfully lobby for lower trade barriers set by the government.

Keywords

Trade unions Lobbying Trade liberalization 

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Copyright information

© Springer-Verlag Berlin Heidelberg 2014

Authors and Affiliations

  1. 1.Institute for Labour Law and Industrial Relations in the European Union (IAAEU)University of TrierTrierGermany
  2. 2.Department of EconomicsUniversity of KasselKasselGermany

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