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Bargainning, reputation and strikes

Author

Listed:
  • Gonzalo Olcina Vauteren

    (Universitat de València)

  • Vicente Calabuig Alcantara

    (Universitat de València)

Abstract

This paper analyses a finitely repeated wage bargaining game, where the union's strike decision is endogenous, but there is incomplete information about his striking strategy space. We characterize the equilibrium path and the equilibrium payoff of all Sequential Equilibria, following the techniques of Schmidt (1993). We obtain a finite bound, independent of the horizon of the repeated game, in the number of periods in which the firm tests the union and in which there are strikes. We also show that for a sufficiently long horizon, the union can credibly threaten to strike and obtain a high wage for most of the periods.

Suggested Citation

  • Gonzalo Olcina Vauteren & Vicente Calabuig Alcantara, 1997. "Bargainning, reputation and strikes," Working Papers. Serie AD 1997-09, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
    • Handle: RePEc:ivi:wpasad:1997-09
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    File URL: http://www.ivie.es/downloads/docs/wpasad/wpasad-1997-09.pdf
    File Function: Fisrt version / Primera version, 1997
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    Cited by:

    1. Gonzalo Olcina Vauteren & Vicente Calabuig Alcantara, 1997. "Forward induction in a wage repeated negotiation," Working Papers. Serie AD 1997-16, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).

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