Are profits shared across borders? Evidence on international rent sharing

John W. Budd, Matthew J. Slaughter

Research output: Contribution to journalReview articlepeer-review

22 Scopus citations

Abstract

The large literature on labor-market rent sharing consists of closed economy analyses. In this article we examine whether profits are shared across borders and also conditioned by international linkages that help shape economic openness. In a sample of 1,014 Canadian manufacturing union contracts from 1980 through 1992, we find that U.S. industry profitability affects Canadian wage outcomes and that the pattern of rent sharing varies significantly across international linkages, including multinational ownership, union type, and trade barriers. There seems to be international rent sharing, with profit sharing across borders conditioned by firm- and industry-level institutions.

Original languageEnglish (US)
Pages (from-to)525-552
Number of pages28
JournalJournal of Labor Economics
Volume22
Issue number3
DOIs
StatePublished - Jul 2004

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