Academic Journal
Wage Bargaining and Capital Accumulation: A Dynamic Version of the Monopoly Union Model.
| Τίτλος: | Wage Bargaining and Capital Accumulation: A Dynamic Version of the Monopoly Union Model. |
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| Συγγραφείς: | Guerrazzi, Marco1 (AUTHOR) guerrazzi@economia.unige.it |
| Πηγή: | Journal of Industry, Competition & Trade. 7/10/2026, Vol. 26 Issue 1, p1-25. 25p. |
| Θεματικοί όροι: | *Wage differentials, *Capital investments, *Negotiation, Differential games, Computer simulation |
| Περίληψη: | In this paper, I explore the relationship between wage bargaining and capital accumulation by developing a differential game in which a monopolistic union sets the wage of its members by taking as given the optimal employment strategy of a representative firm and the way in which capital is evaluated over time. Under the assumption that investment amounts to a constant share of output, I show that a meaningful open-loop Stackelberg equilibrium implies a positive union wage premium that achieves a maximum for a critical value of the elasticity of output with respect to capital which is a decreasing (increasing) function of the discount (depreciation) rate. Moreover, relying on some numerical simulations, I show that capital accumulation displays a non-monotonic pattern along which the union wage premium and the capital share follow a declining path. [ABSTRACT FROM AUTHOR] |
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