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    Temporary social dumping, union legalisation and FDI: a note on the strategic use of standards

    Leahy, Dermot (2000) Temporary social dumping, union legalisation and FDI: a note on the strategic use of standards. Journal of International Trade and Economic Development, 9 (3). pp. 243-259. ISSN 0963-8199

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    This paper analyses the welfare implications for a developing country of using union legalisation as a policy instrument to attract inward foreign direct investment. While its presence may discourage a foreign multinational (MNE) from locating in the host country, unionisation is an important rent-extracting instrument for the host country. We show that if the MNE benefits from dynamic effects, the host country government may have an incentive to adopt temporary social dumping: banning the union in the short run to extract higher rents in the future. However, if the government can use a fiscal instrument in conjunction with union legalisation, the former can circumvent the need to engage in social dumping.

    Item Type: Article
    Keywords: Multinationals; social dumping; labour standards;
    Academic Unit: Faculty of Social Sciences > Economics, Finance and Accounting
    Item ID: 8472
    Depositing User: Dermot Leahy
    Date Deposited: 18 Jul 2017 14:11
    Journal or Publication Title: Journal of International Trade and Economic Development
    Publisher: Taylor & Francis
    Refereed: Yes
    Use Licence: This item is available under a Creative Commons Attribution Non Commercial Share Alike Licence (CC BY-NC-SA). Details of this licence are available here

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