The Structure of Firm-Specific Labour Unions
AbstractIn this paper we investigate trade union formation. To this end we apply a model with two types of labour where both groups decide on whether they prefer to be represented by either two independent craft-specific (professional) labour unions or by a joint (encompassing) labour union. Applying the asymmetric Nash bargaining solution, we find that it is beneficial for at least one group of labourers to resist a unification and to form instead its own independent labour union - and in some cases even both groups are worse off under the umbrella of a joint union. Consequently, a joint union must be considered as a rather unstable institution. As a mirror image, profits are lower if the firm bargains with two independent craft unions. This explains why employers vehemently oppose recent split offs of some occupational groups from existing unions and from stipulated tariff unions.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Tinbergen Institute in its series Tinbergen Institute Discussion Papers with number 13-080/I.
Date of creation: 13 Jun 2013
Date of revision:
Contact details of provider:
Web page: http://www.tinbergen.nl
trade-union formation; wage-employment bargains; Nash bargaining solution; encompassing and craft-specific labour unions; trade union merger;
Find related papers by JEL classification:
- C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
- J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts
- J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Dowrick, Steve, 1993.
"Enterprise Bargaining, Union Structure and Wages,"
The Economic Record,
The Economic Society of Australia, vol. 69(207), pages 393-404, December.
- Britz, Volker & Herings, P. Jean-Jacques & Predtetchinski, Arkadi, 2008.
"Non-cooperative Support for the Asymmetric Nash Bargaining solution,"
018, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).
- Britz, Volker & Herings, P. Jean-Jacques & Predtetchinski, Arkadi, 2010. "Non-cooperative support for the asymmetric Nash bargaining solution," Journal of Economic Theory, Elsevier, vol. 145(5), pages 1951-1967, September.
- Britz, Volker & Herings, P. Jean-Jacques & Predtetchinski, Arkadi, 2008. "Non-cooperative Support for the Asymmetric Nash Bargaining solution," Research Memorandum 018, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).
- MaCurdy, Thomas E & Pencavel, John H, 1986. "Testing between Competing Models of Wage and Employment Determination in Unionized Markets," Journal of Political Economy, University of Chicago Press, vol. 94(3), pages S3-S39, June.
- Klaus Kultti & Hannu Vartiainen, 2010.
"Multilateral non-cooperative bargaining in a general utility space,"
International Journal of Game Theory,
Springer, vol. 39(4), pages 677-689, October.
- Hannu Vartiainen & Klaus Kultti, 2007. "Multilateral Non-Cooperative Bargaining in a General Utility Space," Discussion Papers 19, Aboa Centre for Economics.
- Per Skedinger, 1992. "Employment determination in the Swedish wood industry : a test of the labor demand model," Finnish Economic Papers, Finnish Economic Association, vol. 5(1), pages 27-37, Spring.
- Dowrick, Steve, 1989. "Union-Oligopoly Bargaining," Economic Journal, Royal Economic Society, vol. 99(398), pages 1123-42, December.
- Bayindir-Upmann, Thorsten & Raith, Matthias G., 2003. "Should high-tax countries pursue revenue-neutral ecological tax reforms?," European Economic Review, Elsevier, vol. 47(1), pages 41-60, February.
- Emmanuel Petrakis & Minas Vlassis, .
"Endogenous Wage-Bargaining Institutions in Oligopolistic Sectors,"
0105, University of Crete, Department of Economics, revised 00 Dec 2001.
- Emmanuel Petrakis & Minas Vlassis, 2004. "Endogenous wage bargaining institutions in oligopolistic sectors," Economic Theory, Springer, vol. 24(1), pages 55-73, 07.
- Bill Yang, 1995. "Unionized oligopoly, labor-management cooperation, and international competitiveness," Journal of Economics, Springer, vol. 62(1), pages 33-53, February.
- Svejnar, Jan, 1986.
"Bargaining Power, Fear of Disagreement, and Wage Settlements: Theory and Evidence from U.S. Industry,"
Econometric Society, vol. 54(5), pages 1055-78, September.
- Svejnar, J., 1984. "Bargaining power, fear of disagreement and wage settlements: theory and evidence from U.S. industry," CORE Discussion Papers 1984037, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Miyakawa, Toshiji, 2008. "Note on the equal split solution in an n-person noncooperative bargaining game," Mathematical Social Sciences, Elsevier, vol. 55(3), pages 281-291, May.
- Stefan Boeters, 2004.
"Green Tax Reform and Employment: The Interaction of Profit and Factor Taxes,"
FinanzArchiv: Public Finance Analysis,
Mohr Siebeck, Tübingen, vol. 60(2), pages 222-, August.
- Boeters, Stefan, 2001. "Green tax reform and employment: the interaction of profit and factor taxes," ZEW Discussion Papers 01-45, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
- Kim Moody, 2009. "The Direction of Union Mergers in the United States: The Rise of Conglomerate Unionism," British Journal of Industrial Relations, London School of Economics, vol. 47(4), pages 676-700, December.
- Ralitza Dimova, 2006. "Monopolistic wages or efficient contracts?," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 14(2), pages 321-347, 04.
- Andrea Gavosto, 1997. "The British Docks: A Test of Alternative Models of Wage and Employment Determination," LABOUR, CEIS, vol. 11(2), pages 225-248, 06.
- Jun, Byoung Heon, 1989. "Non-cooperative Bargaining and Union Formation," Review of Economic Studies, Wiley Blackwell, vol. 56(1), pages 59-76, January.
- Ray, Debraj, 2007. "A Game-Theoretic Perspective on Coalition Formation," OUP Catalogue, Oxford University Press, number 9780199207954.
- McDonald, Ian M & Solow, Robert M, 1981. "Wage Bargaining and Employment," American Economic Review, American Economic Association, vol. 71(5), pages 896-908, December.
- Damme, Eric van, 1986. "The Nash bargaining solution is optimal," Journal of Economic Theory, Elsevier, vol. 38(1), pages 78-100, February.
- Walter Trockel, 2000. "Implementations of the Nash solution based on its Walrasian characterization," Economic Theory, Springer, vol. 16(2), pages 277-294.
- Miyagawa, Eiichi, 2002.
"Subgame-perfect implementation of bargaining solutions,"
Games and Economic Behavior,
Elsevier, vol. 41(2), pages 292-308, November.
- Eiichi Miyagawa, 2002. "Subgame-perfect implementation of bargaining solutions," Discussion Papers 0102-16, Columbia University, Department of Economics.
- Davidson, Carl, 1988. "Multiunit Bargaining in Oligopolistic Industries," Journal of Labor Economics, University of Chicago Press, vol. 6(3), pages 397-422, July.
- Ken Binmore & Ariel Rubinstein & Asher Wolinsky, 1986. "The Nash Bargaining Solution in Economic Modelling," RAND Journal of Economics, The RAND Corporation, vol. 17(2), pages 176-188, Summer.
- Walter Trockel, 2002. "A universal meta bargaining implementation of the Nash solution," Social Choice and Welfare, Springer, vol. 19(3), pages 581-586.
- Laruelle, Annick & Valenciano, Federico, 2008. "Noncooperative foundations of bargaining power in committees and the Shapley-Shubik index," Games and Economic Behavior, Elsevier, vol. 63(1), pages 341-353, May.
- Julia Müller & Thorsten Upmann, 2013. "Centralised Labour Market Negotiations," CESifo Working Paper Series 4470, CESifo Group Munich.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Antoine Maartens (+31 626 - 160 892)).
If references are entirely missing, you can add them using this form.