TY  - RPRT
        AU  - Palokangas, Tapio K.
        TI  - Foreign Direct Investment, Labour Market Regulation and Self-Interested Governments
        PY  - 2003/Jun/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 793
        UR  - https://www.iza.org/index.php/publications/dp793
        AB  - This document examines foreign direct investment (FDI) when multinationals and labour
unions bargain over labour contracts and lobby the self-interested government for taxation
and labour market regulation. We demonstrate that right-to-manage bargaining predicts
higher returns for FDI than does non-unionization or efficient bargaining. This advantage is
further magnified in the presence of credible wage contracts. When the labour market is nonunionized,
or there is a bargain over employment, the ruling elite reaps the surplus of FDI
through taxation or regulation. In the absence of credible contracts, unions have incentives to
claim a bigger share of the revenue of FDI.
        KW  - lobbying
KW  - labour market regulation
KW  - foreign direct investment
        ER  -