Wage bargaining and vertical differentiation
Tóm tắt
This paper applies the Nash Bargaining solution to wage setting in a vertically differentiated oligopoly and studies its welfare effects. The market outcome crucially depends on the bargaining power attributed to the agents. I show that the wage bargaining structure is likely to lead to another source of inefficiency that adds to the classical one derived by oligopoly pricing and quality choice. (JEL: L11, J51)
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