Equivalence and stability results for two forms of workers' enterprise facing imperfect labor markets

The equivalence principle for entrepreneurial firms and workers' enterprises generalizes for both imperfect goods and imperfect labor markets in the case of an oligopoly in which firms can discriminate in the labor and worker-partnership markets, but fails if firms cannot. Sufficient conditions are given for the stability of equilibrium, both for industries in which entrepreneurial firms and workers' enterprises are discriminatory and for those in which they are nondiscriminatory in their respective labor situations. (C) 1999 Academic Press.