Wage Bargaining with Time-Varying Threats
AbstractWe study wage bargaining in which the union is uncertain about the firm's willingness to pay and threat payoffs vary over time. Strike payoffs change over time as replacement workers are hired, as strikers find temporary jobs, and as inventories or strike funds run out. We find that bargaining outcomes are substantially altered if threat payoffs vary. If dispute costs increase in the long-run, then dispute durations are longer, settlement rates are lower, and wages decline more slowly during the short-run (and may even increase). The settlement wage is largely determined from the long-run threat, rather than the short-run threat.
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 University of Maryland, Department of Economics - Peter Cramton in its series Papers of Peter Cramton with number 94jolew.
Length: 24 pages
Date of creation: 1994
Date of revision: 09 Jun 1998
Publication status: Published in Journal of Labor Economics, 12:4, October 1994, pages 594-617.
Contact details of provider:
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
Bargaining; Transaction Costs; Strikes; Unions; Private Information;
Other versions of this item:
- J52 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Dispute Resolution: Strikes, Arbitration, and Mediation
- C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
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.:
- Peter Cramton, 1992.
"Strategic Delay in Bargaining with Two-Sided Uncertainty,"
Papers of Peter Cramton
92res, University of Maryland, Department of Economics - Peter Cramton, revised 09 Jun 1998.
- Cramton, Peter C, 1992. "Strategic Delay in Bargaining with Two-Sided Uncertainty," Review of Economic Studies, Wiley Blackwell, vol. 59(1), pages 205-25, January.
- Alan S. Blinder & Louis J. Maccini, 1991. "Taking Stock: A Critical Assessment of Recent Research on Inventories," Journal of Economic Perspectives, American Economic Association, vol. 5(1), pages 73-96, Winter.
- David Card, 1988. "Strikes and Wages: A Test of a Signalling Model," NBER Working Papers 2550, National Bureau of Economic Research, Inc.
- Admati, Anat R & Perry, Motty, 1987. "Strategic Delay in Bargaining," Review of Economic Studies, Wiley Blackwell, vol. 54(3), pages 345-64, July.
- Gunderson, Morley & Kervin, John & Reid, Frank, 1986. "Logit Estimates of Strike Incidence from Canadian Contract Data," Journal of Labor Economics, University of Chicago Press, vol. 4(2), pages 257-76, April.
- Jaume Garcia, & Sergi Jiménez-Martín, 2007.
"Initial Offers and Outcomes in Wage Barganing: Who Wins?,"
- Sergi Jiménez-Martín & Jaume Garcia, 2010. "Initial offers and outcomes in wage bargaining: who wins?," Empirical Economics, Springer, vol. 39(3), pages 815-846, December.
- Srihari Govindan & Robert Wilson, 2006.
"On Forward Induction,"
Levine's Working Paper Archive
321307000000000618, David K. Levine.
- Wilson, Robert B. & Govindan, Srihari, 2007. "On Forward Induction," Research Papers 1955, Stanford University, Graduate School of Business.
- Srihari Govindan & Robert Wilson, 2007. "'On Forward Induction," Levine's Working Paper Archive 321307000000000825, David K. Levine.
- Srihari Govindan & Robert Wilson, 2008. "On Forward Induction," Levine's Working Paper Archive 122247000000001859, David K. Levine.
- Srihari Govindan & Robert Wilson, 2007. "On Forward Induction," Levine's Bibliography 321307000000000788, UCLA Department of Economics.
- Coles, Melvyn & Smith, Eric, 1998. "Strategic bargaining with firm inventories," Journal of Economic Dynamics and Control, Elsevier, vol. 23(1), pages 35-54, September.
- Ahmet Ozkardas & Agnieszka Rusinowska, 2013. "An application of wage bargaining to price negotiation with discount factors varying in time," UniversitÃ© Paris1 PanthÃ©on-Sorbonne (Post-Print and Working Papers) halshs-00881151, HAL.
- Ahmet Ozkardas & Agnieszka Rusinowska, 2013. "An application of wage bargaining to price negotiation with discount factors varying in time," Documents de travail du Centre d'Economie de la Sorbonne 13066, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
- Cramton, Peter & Kwerel, Evan & Williams, John, 1998.
"Efficient Relocation of Spectrum Incumbents,"
Journal of Law and Economics,
University of Chicago Press, vol. 41(2), pages 647-75, October.
- Adriana Cassoni, 1997. "A brief survey on the role of trade unions in labour market," Documentos de Trabajo (working papers) 0697, Department of Economics - dECON.
- Ahmet Ozkardas & Agnieszka Rusinowska, 2012.
"Wage bargaining with discount rates varying in time under exogenous strike decisions,"
Documents de travail du Centre d'Economie de la Sorbonne
12013, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
- Ahmet Ozkardas & Agnieszka Rusinowska, 2012. "Wage bargaining with discount rates varying in time under exogenous strike decisions," UniversitÃ© Paris1 PanthÃ©on-Sorbonne (Post-Print and Working Papers) halshs-00674033, HAL.
- Carlos Diaz-Moreno & Jose E. Galdon-Sanchez, 2000.
"Collective Bargaining under Complete Information,"
STICERD - Theoretical Economics Paper Series
401, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE.
- Kennan, John, 1995. "Repeated contract negotiations with private information," Japan and the World Economy, Elsevier, vol. 7(4), pages 447-472, November.
- Houba, Harold & Bolt, Wilko, 2000. "Holdouts, backdating and wage negotiations," European Economic Review, Elsevier, vol. 44(9), pages 1783-1800, October.
- Govindan, Srihari & Wilson, Robert B., 2008. "Decision-Theoretic Forward Induction," Research Papers 1986, Stanford University, Graduate School of Business.
- Goerke, Laszlo & Schnabel, Claus, 2002. "On strike insurance," Discussion Papers 12, Friedrich-Alexander-University Erlangen-Nuremberg, Chair of Labour and Regional Economics.
- Shogren, Jason F., 1998. "Coasean bargaining with symmetric delay costs," Resource and Energy Economics, Elsevier, vol. 20(4), pages 309-326, December.
- Ahmet Ozkardas & Agnieszka Rusinowska, 2012. "Wage bargaining with discount rates varying in time under exogenous strike decisions," Post-Print halshs-00674033, HAL.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Peter Cramton).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.