TITLE:
Does Uniform Wage Decline the Welfare in a Budget-Constraint Mixed Market?
AUTHORS:
Ting-Chung Tsai, Kuang-Feng Cheng, Chuchuan Hsu, Chienshu Tsai, Chienchih Chen, Jenyao Lee
KEYWORDS:
Decentralised Unions, Centralised Union, Productivity Difference, Privatization
JOURNAL NAME:
Modern Economy,
Vol.10 No.2,
February
18,
2019
ABSTRACT:
In this paper, we explore the influence of union structure and wage pricing strategies on the
welfare under a mixed oligopoly which has a public firm with budget constraint. We showed
that, the total utilities of the decentralized unions are higher than the
utility of the centralized union under mixed duopoly if the centralized union
charges a uniform wage and the productivity difference is large. The government
should restrict the centralized union formed by the public and the private firm
to charge discriminatory wages, and to avoid the improper use of the monopoly power of
the labour union.