IDEAS home Printed from https://ideas.repec.org/a/eee/labeco/v3y1996i1p1-23.html
   My bibliography  Save this article

Authority in employment contracts: A bilateral bargaining model

Author

Listed:
  • Manning, Alan

Abstract

This paper takes a model of the employment contract which is incomplete in the sense that the required effort level is not exactly specified when employment is agreed and in which each worker negotiates their own contract with their employer. Given the incompleteness of the employment contract, residual rights of control over labour need to be specified. This paper analyses the allocation of these residual rights of control. It is argued that equilibrium employment contracts will tend to give the employer residual rights of control over labour, if workers are potential substitutes and give workers residual rights of control if workers are complements. However, it may not be the case that the equilibrium contracts maximise the available social surplus; in this case there is an argument for government intervention to regulate the form of employment contracts.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Manning, Alan, 1996. "Authority in employment contracts: A bilateral bargaining model," Labour Economics, Elsevier, vol. 3(1), pages 1-23, August.
    • Handle: RePEc:eee:labeco:v:3:y:1996:i:1:p:1-23
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/0927-5371(96)00005-X
    Download Restriction: Full text for ScienceDirect subscribers only
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Rubinstein, Ariel, 1982. "Perfect Equilibrium in a Bargaining Model," Econometrica, Econometric Society, vol. 50(1), pages 97-109, January.
    2. Hart, Oliver & Moore, John, 1990. "Property Rights and the Nature of the Firm," Journal of Political Economy, University of Chicago Press, vol. 98(6), pages 1119-1158, December.
    3. Krueger, Alan B & Summers, Lawrence H, 1988. "Efficiency Wages and the Inter-industry Wage Structure," Econometrica, Econometric Society, vol. 56(2), pages 259-293, March.
    4. Grossman, Sanford J & Hart, Oliver D, 1986. "The Costs and Benefits of Ownership: A Theory of Vertical and Lateral Integration," Journal of Political Economy, University of Chicago Press, vol. 94(4), pages 691-719, August.
    5. Byoung Heon Jun, 1989. "Non-cooperative Bargaining and Union Formation," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 56(1), pages 59-76.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. David Marsden, 2015. "The future of the German industrial relations model [Die Zukunft des deutschen Modells der Arbeitsbeziehungen]," Journal for Labour Market Research, Springer;Institute for Employment Research/ Institut für Arbeitsmarkt- und Berufsforschung (IAB), vol. 48(2), pages 169-187, August.
    2. Charles C. Fischer, 1994. "The Valuation of Household Production: Divorce, Wrongful Injury and Death Litigation," American Journal of Economics and Sociology, Wiley Blackwell, vol. 53(2), pages 187-199, April.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Sudipto Bhattacharya & Sergei Guriev, 2006. "Patents vs. Trade Secrets: Knowledge Licensing and Spillover," Journal of the European Economic Association, MIT Press, vol. 4(6), pages 1112-1147, December.
    2. Garvey, Gerald T., 1995. "Why reputation favors joint ventures over vertical and horizontal integration A simple model," Journal of Economic Behavior & Organization, Elsevier, vol. 28(3), pages 387-397, December.
    3. Schmitz, Patrick W., 2013. "Incomplete contracts and optimal ownership of public goods," Economics Letters, Elsevier, vol. 118(1), pages 94-96.
    4. Schmitz, Patrick W., 2013. "Bargaining position, bargaining power, and the property rights approach," Economics Letters, Elsevier, vol. 119(1), pages 28-31.
    5. Robert Gibbons & John Roberts, 2012. "The Handbook of Organizational Economics," Economics Books, Princeton University Press, edition 1, volume 1, number 9889.
    6. J. Amegashie, 2011. "Incomplete property rights and overinvestment," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 37(1), pages 81-95, June.
    7. Chiu, Y. Stephen & Rachel Yang, B., 1999. "The outside option, threat point, and Nash bargaining solution," Economics Letters, Elsevier, vol. 62(2), pages 181-188, February.
    8. Roman Inderst & Holger M. Mueller & Felix Münnich, 2006. "Financing a Portfolio of Projects," Review of Financial Studies, Society for Financial Studies, vol. 20(4), pages 1289-1325.
    9. Kvaløy, Ola, 2008. "Do norms matter for firm boundaries?," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 37(3), pages 969-975, June.
    10. Tore Ellingsen & Magnus Johannesson, 2004. "Is There a Hold‐up Problem?," Scandinavian Journal of Economics, Wiley Blackwell, vol. 106(3), pages 475-494, October.
    11. Yeon-Koo Che & József Sákovics, 2004. "A Dynamic Theory of Holdup," Econometrica, Econometric Society, vol. 72(4), pages 1063-1103, July.
    12. Maxim Mai & Vladimir Smirnov & Andrew Wait, 2014. "Ownership, Access, and Sequential Investment," Canadian Journal of Economics, Canadian Economics Association, vol. 47(1), pages 203-231, February.
    13. Ricardo J. Caballero & Mohamad L. Hammour, 1998. "The Macroeconomics of Specificity," Journal of Political Economy, University of Chicago Press, vol. 106(4), pages 724-767, August.
    14. Thomas Ehrmann & Karl-Hans Hartwig & Torsten Marner & Hendrik Schmale, 2009. "Specific Investments and Ownership Structures in Railways – An Experimental Analysis," Working Papers 12, Institute of Transport Economics, University of Muenster.
    15. Bhattacharya, Sudipto & Guriev, Sergei, 2004. "Knowledge Disclosure, Patents and Optimal Organization of Research and Development," CEPR Discussion Papers 4513, C.E.P.R. Discussion Papers.
    16. Ilya Segal & Michael D.Whinston, 2012. "Property Rights [The Handbook of Organizational Economics]," Introductory Chapters,, Princeton University Press.
    17. Armando Gomes, "undated". "Multiple Large Shareholders in Corporate Governance," Rodney L. White Center for Financial Research Working Papers 5-99, Wharton School Rodney L. White Center for Financial Research.
    18. Kusterer, David J. & Schmitz, Patrick W., 2020. "Public goods, property rights, and investment incentives: An experimental investigation," Journal of Economic Behavior & Organization, Elsevier, vol. 177(C), pages 514-532.
    19. Dow,Gregory K., 2019. "The Labor-Managed Firm," Cambridge Books, Cambridge University Press, number 9781107589650, January.
    20. David de Meza & Mariano Selvaggi, 2004. "Exclusive Contracts Foster Relationship-Specific Investment," The Centre for Market and Public Organisation 04/105, The Centre for Market and Public Organisation, University of Bristol, UK.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:labeco:v:3:y:1996:i:1:p:1-23. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/labeco .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.