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The Determinants of U.S. Labor Disputes

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Abstract

We present a bargaining model of union contract negotiations, in which the union decides between two threats: the union can strike or continue to work under the expired contract. The model makes predictions about the level of dispute activity and the form the disputes take. Strike incidence increases as the strike threat becomes more attractive, because of low unemployment or a real wage drop during the prior contract. We test these predictions by estimating logistic models of dispute incidence and dispute composition for U.S. labor contract negotiations from 1970 to 1989. We find empirical support for the model's key predictions, but these associations are weaker after 1981.

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File URL: http://www.cramton.umd.edu/papers1990-1994/94jole-determinants-of-us-labor-disputes.pdf
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Bibliographic Info

Paper provided by University of Maryland, Department of Economics - Peter Cramton in its series Papers of Peter Cramton with number 94jole.

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Length: 30 pages
Date of creation: 1994
Date of revision: 09 Jun 1998
Publication status: Published in Journal of Labor Economics, 12:2, April 1994, pages 180-209.
Handle: RePEc:pcc:pccumd:94jole

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Postal: Economics Department, University of Maryland, College Park, MD 20742-7211
Phone: (202) 318-0520
Fax: (202) 318-0520
Web page: http://www.cramton.umd.edu

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Keywords: Bargaining; Contract Negotiations; Strikes;

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References

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  1. Michael L. Wachter & William H. Carter, 1989. "Norm Shifts in Union Wages: Will 1989 Be a Replay of 1969?," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 20(2), pages 233-276.
  2. Card, David, 1990. "Strikes and Bargaining: A Survey of the Recent Empirical Literature," American Economic Review, American Economic Association, vol. 80(2), pages 410-15, May.
  3. Joseph S. Tracy, 1986. "An Empirical Test of an Asymmetric Information Model of Strikes," NBER Working Papers 1870, National Bureau of Economic Research, Inc.
  4. John M. Abowd & Joseph S. Tracy, 1988. "Market Structure, Strike Activity, and Union Wage Settlements," NBER Working Papers 2595, National Bureau of Economic Research, Inc.
  5. Ariel Rubinstein, 2010. "Perfect Equilibrium in a Bargaining Model," Levine's Working Paper Archive 252, David K. Levine.
  6. John M. Abowd & Richard B. Freeman, 1991. "Immigration, Trade and the Labor Market," NBER Books, National Bureau of Economic Research, Inc, number abow91-1.
  7. Reder, Melvin W & Neumann, George R, 1980. "Conflict and Contract: The Case of Strikes," Journal of Political Economy, University of Chicago Press, vol. 88(5), pages 867-86, October.
  8. Peter Cramton & Joseph S. Tracy, 1992. "Strikes and Holdouts in Wage Bargaining: Theory and Data," Papers of Peter Cramton 92aer, University of Maryland, Department of Economics - Peter Cramton, revised 09 Jun 1998.
  9. Kennan, John & Wilson, Robert, 1989. "Strategic Bargaining Models and Interpretation of Strike Data," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 4(S), pages S87-130, Supplemen.
  10. John M. Abowd & Richard B. Freeman, 1990. "The Internationalization of the U.S. Labor Market," NBER Working Papers 3321, National Bureau of Economic Research, Inc.
  11. McConnell, Sheena, 1989. "Strikes, Wages, and Private Information," American Economic Review, American Economic Association, vol. 79(4), pages 801-15, September.
  12. Admati, Anat R & Perry, Motty, 1987. "Strategic Delay in Bargaining," Review of Economic Studies, Wiley Blackwell, vol. 54(3), pages 345-64, July.
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Citations

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Cited by:
  1. Malo, Miguel A. & Sanchez-sanchez, Nuria, 2011. "The legal form of labour conflicts and their time persistence: an empirical analysis with a large firms' panel," MPRA Paper 30117, University Library of Munich, Germany.
  2. Ana Mauleon & Vincent Vannetelbosch, 2013. "Relative Concerns and Delays in Bargaining with Private Information," Games, MDPI, Open Access Journal, vol. 4(3), pages 329-338, June.
  3. van Ours, Jan C., 1999. "The cyclical behavior of holdout durations," Economics Letters, Elsevier, vol. 62(3), pages 365-370, March.
  4. Mauleon, Ana & Vannetelbosch, Vincent J., 2003. "Market competition and strike activity," International Journal of Industrial Organization, Elsevier, vol. 21(5), pages 737-758, May.
  5. Hiroko Okudaira, 2009. "The Economic Costs of Court Decisions Concerning Dismissals in Japan: Identification by Judge Transfers," ISER Discussion Paper 0733, Institute of Social and Economic Research, Osaka University.
  6. MAULEON, Ana & VANNETELBOSCH, Vincent & VERGARI, Cecilia, 2010. "Unions' relative concerns and strikes in wage bargaining," CORE Discussion Papers 2010076, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  7. Louis N. Christofides & Amy Peng, 2007. "Real Wage Chronologies," Working Papers 0707, University of Guelph, Department of Economics and Finance.
  8. Richard R. W. Brooks & Claudia M. Landeo & Kathryn E. Spier, 2010. "Trigger happy or gun shy? Dissolving common-value partnerships with Texas shootouts," RAND Journal of Economics, RAND Corporation, vol. 41(4), pages 649-673.
  9. Ana, MAULEON & Vincent, VANNETELBOSCH, 2005. "Market Integration and Strike Activity," Discussion Papers (ECON - Département des Sciences Economiques) 2005025, Université catholique de Louvain, Département des Sciences Economiques.
  10. Danziger, Leif, 2008. "Extension of labor contracts and optimal backpay," Labour Economics, Elsevier, vol. 15(1), pages 18-36, February.
  11. Danziger, Leif & Neuman, Shoshana, 2003. "Delays in Renewal of Labor Contracts: Theory and Evidence," IZA Discussion Papers 709, Institute for the Study of Labor (IZA).
  12. Angur, Madhukar G. & Lotfi, Vahid & Sarkis, Joseph, 1996. "A hybrid conjoint measurement and bi-criteria model for a two group negotiation problem," Socio-Economic Planning Sciences, Elsevier, vol. 30(3), pages 195-206, September.
  13. Peter Cramton & Joseph Tracy, 2003. "Unions, Bargaining and Strikes," Papers of Peter Cramton 02ubs, University of Maryland, Department of Economics - Peter Cramton, revised 05 Sep 2002.
  14. Kennan, John, 1995. "Repeated contract negotiations with private information," Japan and the World Economy, Elsevier, vol. 7(4), pages 447-472, November.
  15. Sergi Jimenez-Martin & José M. Labeaga & Mariluz Marco, 1996. "Algunos factores explicativos de la existencia de huelgas durante la negociación colectiva en España," Investigaciones Economicas, Fundación SEPI, vol. 20(2), pages 217-242, May.

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