This paper deals with a specific institution of the Swiss labour market called the work peace agreement. It notably appeared in 1937 in the machine and metal work industry. First, the paper portrays the characteristics of the agreement and work peace clauses in Switzerland. Second, the paper describes the emergence of the 1937 agreement, which was a big step in Swiss industrial relations. The agents’ strategies and external economic pressure which provoked the move to cooperation are the main factors stressed. Third, the problem of the agreement persistence is addressed. As benefits from the convention generate a context of public goods allocation, finally the paper scrutinises the free rider problem which is expanding when the agreement is continuously signed.
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