Should civil servants be restricted in wage bargaining? A mixed-duopoly approach ☆

摘要: Abstract Should civil servants (employees in the public sector) be allowed to bargain collectively? To answer this question, we construct a model of unionized mixed duopoly and examine regulatory framework institutions, especially focusing on wage regulation imposed firm. The turns out yield critical welfare implications as it gives rise two opposing strategic effects: intensifies downstream-market competition while loosens upstream-market competition. overall effect is ambiguous, depending crucially degree product differentiation between firms. We also show that, contrast popular belief, granting right collectively would not necessarily help them because they tend demand excessively high wages when are collectively. Finally, briefly discuss new perspective role profit motives institutions determined endogenously.