A COMPUTABLE GENERAL EQUILIBRIUM MODEL FOR THE ORGANIZED AND MARGINAL LABOR

We consider several economic union scenarios between Turkey and the EU in relation to their impact on the marginal and organized labor markets. We simulate a general equilibrium model to obtain results. We show that wage rate and employment will be positively affected in almost all sectors of the economy with the access into European markets. Organized labor demand, however, tends to increase more than marginal labor demand in most sectors. This shows that the quality of Turkish labor tends to increase with integration. Thus, we propose Turkey should continue its efforts to seek full membership into the European Union