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The Use of Replacement Workers in Union Contract Negotiations: The U.S. Experience, 1980-1989

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Abstract

It is argued in many circles that a structural change occurred in U.S. collective bargaining in the 1980s. Strike incidence declined, dispute incidence increased, and the composition of disputes shifted away from strikes and toward holdouts. We investigate the extent to which the hiring of replacement workers can account for these changes. For a sample of over 300 major strikes since 1980, we estimate the likelihood of replacements being hired. We find that the risk of replacement is lower for bargaining units with more experienced workers, and declines during tight labor markets. The composition of disputes shifts away from strikes as the predicted risk of replacement increases. In addition, the overall level of disputes increases as a result of the shift in the composition of disputes. Based on our estimates reducing the predicted replacement risk faced by bargaining units to the pre-1982 levels would have lead to a reduction in the dispute incidence by around 5 percentage points, an increase in the fraction of disputes involving a strike by around 4 percentage points, and an increase in the strike incidence by around 0.8 percentage points.

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File URL: http://www.cramton.umd.edu/papers1995-1999/98jole-use-of-replacement-workers.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 98jole.

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Length: 38 pages
Date of creation: 09 Jun 1998
Date of revision: 09 Jun 1998
Publication status: Published in Journal of Labor Economics, 16:4, October 1998, pages 667-701.
Handle: RePEc:pcc:pccumd:98jole

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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: Collective Bargaining; Strikes; Holdouts;

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References

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  1. Steven G. Allen, 1996. "Technology and the Wage Structure," NBER Working Papers 5534, National Bureau of Economic Research, Inc.
  2. Peter Cramton & Morley Gunderson & Joseph Tracy, 1999. "The Effect Of Collective Bargaining Legislation On Strikes And Wages," The Review of Economics and Statistics, MIT Press, vol. 81(3), pages 475-487, August.
  3. Henry S. Farber & Alan Krueger, 1992. "Union Membership in the United States: The Decline Continues," Working Papers 685, Princeton University, Department of Economics, Industrial Relations Section..
  4. Gunderson, Morley & Melino, Angelo, 1990. "The Effects of Public Policy on Strike Duration," Journal of Labor Economics, University of Chicago Press, vol. 8(3), pages 295-316, July.
  5. Cramton, Peter C & Tracy, Joseph S, 1992. "Strikes and Holdouts in Wage Bargaining: Theory and Data," American Economic Review, American Economic Association, vol. 82(1), pages 100-121, March.
  6. Ann P. Bartel & Nachum Sicherman, 1995. "Technological Change and the Skill Acquisition of Young Workers," NBER Working Papers 5107, National Bureau of Economic Research, Inc.
  7. repec:fth:prinin:306 is not listed on IDEAS
  8. John F. Schnell & Cynthia L. Gramm, 1994. "The empirical relations between employers' striker replacement strategies and strike duration," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 47(2), pages 189-206, January.
  9. Admati, Anat R & Perry, Motty, 1987. "Strategic Delay in Bargaining," Review of Economic Studies, Wiley Blackwell, vol. 54(3), pages 345-64, July.
  10. Bartel, A.P. & Sicherman, N., 1995. "Technological Change and the Skill Acquisition of Young Workers," Papers 95-10, Columbia - Graduate School of Business.
  11. 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.
  12. Daniel J. B. Mitchell, 1982. "Recent Union Contract Concessions," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 13(1), pages 165-204.
  13. 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.
  14. Cynthia L. Gramm & John F. Schnell, 1994. "Some Empirical Effects Of Using Permanent Striker Replacements," Contemporary Economic Policy, Western Economic Association International, vol. 12(3), pages 122-133, 07.
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Cited by:
  1. Jonathan Gruber & Samuel A. Kleiner, 2010. "Do Strikes Kill? Evidence from New York State," NBER Working Papers 15855, National Bureau of Economic Research, Inc.
  2. Barry T. Hirsch, 2008. "Sluggish Institutions in a Dynamic World: Can Unions and Industrial Competition Coexist?," Journal of Economic Perspectives, American Economic Association, vol. 22(1), pages 153-176, Winter.
  3. David M. Frankel, 2010. "Rent Seeking and Economic Fragility," Levine's Bibliography 661465000000000159, UCLA Department of Economics.
  4. Hirsch, Barry, 2010. "Unions, Dynamism, and Economic Performance," IZA Discussion Papers 5342, Institute for the Study of Labor (IZA).

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