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CAN UNIONS HURT WORKERS? A POSITIVE ANALYSIS OF IMMIGRATION POLICY
Author(s) -
BELLETTINI GIORGIO,
BERTI CERONI CARLOTTA
Publication year - 2008
Publication title -
economics and politics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.822
H-Index - 45
eISSN - 1468-0343
pISSN - 0954-1985
DOI - 10.1111/j.1468-0343.2007.00313.x
Subject(s) - immigration , economics , welfare , point (geometry) , government (linguistics) , labour economics , immigration policy , politics , trade union , social welfare , power (physics) , single market , market economy , economic system , economic policy , european union , political science , linguistics , philosophy , physics , geometry , mathematics , quantum mechanics , law
This paper studies the determinants of immigration policy in an economy with entrepreneurs and workers where a trade union has market power over wages. The presence of the union induces a social welfare maximizing government to implement a high level of immigration, leading to a welfare loss not only from an aggregate point of view but also from the workers' point of view. When interest group politics prevails and workers' ability to influence the policy‐maker is strengthened by existence of the union, we show the conditions under which workers may benefit from the presence of the union.