Does globalization weaken labor unions in developing countries?

2011/07/09 by Hamid Beladi, Chi‐Chur Chao, Daniel Hollas · 1 citation
Economics, Econometrics and Finance · Social Sciences · #Capital (architecture) #Developing country #Economic growth #Economics #Globalization #Inefficiency #Labor Movements and Unions #Labour economics #Market economy #Migration, Ethnicity, and Economy #Taxation and Compliance Studies #Wage

paper · doi:10.1080/09638199.2011.578752

openalex publication_date 2011/07/09 · openalex created_date 2025/10/10 · openalex updated_date 2026/07/29

Abstract

For a developing economy with a given urban wage rate, globalization in capital markets strengthens labor unions. This result hinges on the fixed urban wage rate, which leads to a constant capital–labor ratio in the urban sector. Globalization via capital inflows not only enhances the employment effect of unionization but also reduces the rent-shifting related loss in production inefficiency to domestic capital, lending a support to labor unions for developing economies. This result is contrary to the common belief that labor unions tend to be weakened during the globalization process observed after 1980s in many developed economies.

Cited by

• Economic globalization [wikipedia]

Related

• Distribution and globalization. A wage bargaining model.
• Union membership and density: Some (not so) stylized facts and challenges
• Labor Unions, Political Representation, and Economic Inequality
• National Labor Movements and Transnational Connections: Global Labor’s Evolving Architecture Under Neoliberalism
• Life after crisis for capital and labor in the era of neoliberal globalization