We analyse how union structures that differ in the degree of wagesetting centralisation affect the pattern of R& network formation. Within the context of a threefirmindustry, a central union that sets a uniform wage is shown to induce a partial R& network that includes two firms but excludes the third. In contrast, we find that, under less centralised union structures, firms haveincentives to form R& networks with a larger number of alliances. This result is consistent with the stylised facts for industrialised countries: recent decades have seen an upsurge in R& alliances along with labour market deregulation towards more flexible wagesettinginstitutions.