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Profits Under Centralized Negotiations: The Efficient Bargaining Case

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  • Buccella Domenico

    (Department of Economics, Kozminski University, Jagiellońska Street, 57/59 – 03301Warsaw, Poland)

  • Fanti Luciano

    (Department of Economics and Management, University of Pisa, Via Cosimo Ridolfi, 10, I –56124Pisa (PI), Italy)

Abstract

Making use of a Conjectural Variation model, the present note re-examines the subject of the firms’ profits ranking under different degrees of market competition in a unionized duopoly with industry-wide Efficient Bargaining (EB). It is shown that, while Cournot-like competition profits are always larger than Bertrand-like ones with separated wage negotiations, an uniform wage bargaining can lead to the appearance of the reversal.

Suggested Citation

  • Buccella Domenico & Fanti Luciano, 2019. "Profits Under Centralized Negotiations: The Efficient Bargaining Case," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 19(2), pages 1-8, June.
    • Handle: RePEc:bpj:bejtec:v:19:y:2019:i:2:p:8:n:9
    DOI: 10.1515/bejte-2017-0176
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    References listed on IDEAS

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    Cited by:

    1. Domenico Buccella & Luciano Fanti, 2022. "Downstream competition and profits under different input price bargaining structures," Journal of Economics, Springer, vol. 136(3), pages 251-268, August.

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    More about this item

    Keywords

    centralized bargaining; efficient bargaining; conjectural variation model;
    All these keywords.

    JEL classification:

    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets

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