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Strike Ballots as a Commitment Device

Author

Listed:
  • Laszlo Goerke
  • Manfred J. Holler

Abstract

The consequences of strike ballots are analysed in a non-cooperative model of negotiations between a union and a firm over wage increases. The firm possesses private information about its revenues. The union can only stop the firm from rejecting wage demands if a refusal is costly, due to a strike. However, under plausible assumptions, strike threats are empty. Ballots will make strike threats credible if they provide sufficient commitment. For this effect to occur, the timing of voting is of crucial importance. If the legislator makes strike ballots compulsory, disputes can become more likely. Finally, principles of optimal majority rules for ballots are dreived.

Suggested Citation

  • Laszlo Goerke & Manfred J. Holler, 1999. "Strike Ballots as a Commitment Device," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 155(3), pages 487-487, September.
  • Handle: RePEc:mhr:jinste:urn:sici:0932-4569(199909)155:3_487:sbaacd_2.0.tx_2-1
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    Cited by:

    1. Mauleon, Ana & Vannetelbosch, Vincent, 2004. "Bargaining with endogenous deadlines," Journal of Economic Behavior & Organization, Elsevier, vol. 54(3), pages 321-335, July.
    2. Gürtzgen, Nicole & Garloff, Alfred, 2008. "Innovationen in den Rahmenbedingungen von Tarifverhandlungen: Endbericht zum Projekt," ZEW Expertises, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research, number 110513.

    More about this item

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • J52 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Dispute Resolution: Strikes, Arbitration, and Mediation

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