Unionization and European antidumping protection

Abstract

In recent decades, the WTO has resulted in a worldwide reduction of tariffs and VERs. Instead a new type of trade policy has emerged in the form of antidumping measures. In principle their use should be limited to instances of unfair foreign imports. However, even without unfair pricing, a foreign importer can fall within the scope of the European antidumping legislation. The purpose of this paper is to analyze the interaction between unionization and the likelihood, type and effects of antidumping measures. We present a simple theoretical model which is well embedded in EU legal practice, to show that the presence of European unions leads to an increase in both the likelihood and the level of antidumping protection. In addition our results indicate that a cost asymmetry in the form of a unionized wage differential can alter the relative probability of a duty versus an undertaking. These effects depend on the intensity of product market competition. The paper concludes with some evidence from EU antidumping cases between 1985±95.

Estimation of price-cost margins and union bargaining power for Belgian manufacturing

“…In Model 3, the estimated mark-up ratio ranges from 1.017 to 2.088 and the bargaining power parameter varies from 0.042 to 0.394. Our estimates of union bargaining power accord with those of Vandenbussche et al (2001), who estimate bargaining power coefficients for NACE three-digit sectors over the period 1987-1994. Model 4 points to a range of 1-2.268 for the estimated mark-up ratio and 0.051-0.400 for union bargaining power.…”

Do R&D tax incentives lead to higher wages for R&D workers? Evidence from The Netherlands

“…substitutability of R&D skills within or across industries. It could be set to zero, an approach taken by Vandenbussche et al (2001). Ideally, it should reflect the marginal productivity of labor (MPL) prevailing in each industry.…”

Has International Trade Affected Workers’ Bargaining Power?

“…In our empirical analysis, the workers' outside option (w a in (4)) is proxied by the real minimum wage per worker of the sector in which the firm operates (see e.g. Veugelers 1989 andVandenbussche et al 2001). We also experimented with the average real annual wage per worker and the sectoral unemployment rate as a measure for the workers' alternative wage.…”

“…While the first two channels have been investigated empirically, 3 there is no direct evidence of the last channel so far. Dobbelaere (2004a), Vandenbussche et al (2001) and Veugelers (1989) for Belgium and Svejnar (1986) for the United States point out that there is a lot of cross-industry variation in the bargaining power coefficient. Svejnar (1986) and Veugelers (1989) further examine the determinants of this crossindustry variation.…”