Wages, Fringe Benefits and Efficiency in Union-Firm Bargaining
AbstractThis paper provides an efficient union-firm bargaining solution within the right to manage framework, by separating efficiency and distribution considerations through bargaining over wage and fringe benefits. We show that without insurance considerations, efficiency is achieved by equating the wage and workers’ opportunity cost and providing the union with a surplus share in accordance with its bargaining power. We also show that with insurance considerations, the optimal contract, again, equates the wage and workers’ opportunity cost, but it also provides full insurance. There is empirical evidence that fringe benefits are, indeed, common and play an important role in union contracts.
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Bibliographic InfoPaper provided by York University, Department of Economics in its series Working Papers with number 2008_04.
Length: 15 pages
Date of creation: Feb 2008
Date of revision:
Price Union Contracts; Efficient Bargaining; Right to Manage;
Find related papers by JEL classification:
- J5 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining
- C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-03-08 (All new papers)
- NEP-BEC-2008-03-08 (Business Economics)
- NEP-LAB-2008-03-08 (Labour Economics)
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.:
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