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International Labor Union Policy and Growth with Creative Destruction *
Author(s) -
Palokangas Tapio
Publication year - 2005
Publication title -
review of international economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.513
H-Index - 58
eISSN - 1467-9396
pISSN - 0965-7576
DOI - 10.1111/j.1467-9396.2005.00493.x
Subject(s) - economics , interdependence , welfare , labour economics , growth model , production (economics) , government (linguistics) , endogenous growth theory , international economics , market economy , macroeconomics , political science , linguistics , philosophy , law , human capital
A multi‐economy Schumpeterian growth model is constructed. Economies are interdependent through technology transfer. Households can stay as workers or become researchers at some cost. Workers are employed in production and researchers in R&D. Workers are unionized and union power depends on the government's protection. The main findings are as follows. If international technological dependence increases, then workers’ wages, the growth rate, and the level of welfare fall. The international coordination of labor union policy raises workers’ wages and promotes growth and welfare.