Wage Bargaining, Inequality, and the Dutch Disease.

The theory of the "Dutch Disease" predicts that income from oil and other natural resources produces negative economic consequences through two different mechanisms. The "Resource Movement Effect" suggests that workers leave manufacturing for higher-paying jobs in other sectors. The "Spending Effect...

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Publicado en:International Studies Quarterly Vol. 60; no. 4; pp. 677 - 693
Autor principal: BUNTE, JONAS B.
Formato: Artículo
Publicado: Oxford University Press / USA Dec2016
Materias:
Acceso en línea:Ver este registro en EBSCOhost
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        atl: Wage Bargaining, Inequality, and the Dutch Disease.
      aug:
        au: BUNTE, JONAS B.
        affil: University of Texas at Dallas
      su:
        Resource exploitation
        Income inequality
        Dutch disease (Economics)
        Wage bargaining
        Foreign exchange rates
      sug:
        subj:
          Resource exploitation
          Income inequality
          Labor Unions and Similar Labor Organizations
          Dutch disease (Economics)
          Wage bargaining
          Foreign exchange rates
      ab: The theory of the "Dutch Disease" predicts that income from oil and other natural resources produces negative economic consequences through two different mechanisms. The "Resource Movement Effect" suggests that workers leave manufacturing for higher-paying jobs in other sectors. The "Spending Effect" implies that spending resource wealth domestically leads to exchange rate appreciation. The combination of these processes results in the contraction of the export sector. This article explores how, and why, a country's institutions may prevent the Dutch Disease before it starts. Incorporating insights from the "Varieties of Capitalism" literature, I find that the Dutch Disease is significantly less severe in countries with a high degree of wage bargaining coordination and with low income inequality. The former interrupts the Resource Movement Effect as it limits workers' incentives to move out of the tradable sector. The latter moderates the Spending Effect because it prevents appreciation of the real exchange rate.
      pubtype: Academic Journal
      doctype: Article
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    language: English
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