IDEAS home Printed from https://ideas.repec.org/a/sae/jocore/v34y1990i1p151-167.html

Interest Arbitration and the Incentive to Bargain

Author

Listed:
  • Brian P. McCall

    (University of Minnesota)

Abstract

This article develops an asymmetric information model of final-offer arbitration. If the union negotiator has superior information about the bargaining environment, then the union rank and file may find it in their best interest to require their negotiator to go to arbitration some of the time. In a simple two-state model, it is shown that if arbitration is rational for the union rank and file, it will occur only in the state where the bargaining environment is unfavorable to the union.

Suggested Citation

  • Brian P. McCall, 1990. "Interest Arbitration and the Incentive to Bargain," Journal of Conflict Resolution, Peace Science Society (International), vol. 34(1), pages 151-167, March.
    • Handle: RePEc:sae:jocore:v:34:y:1990:i:1:p:151-167
    DOI: 10.1177/0022002790034001008
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1177/0022002790034001008
    Download Restriction: no
    File URL: https://libkey.io/10.1177/0022002790034001008?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Myerson, Roger B, 1979. "Incentive Compatibility and the Bargaining Problem," Econometrica, Econometric Society, vol. 47(1), pages 61-73, January.
    2. Hayes, Beth, 1984. "Unions and Strikes with Asymmetric Information," Journal of Labor Economics, University of Chicago Press, vol. 2(1), pages 57-83, January.
    3. Henry S. Farber & Max H. Bazerman, 1987. "Divergent Expectations as a Cause of Disagreement in Bargaining: Evidence from a Comparison of Arbitration Schemes," Working papers 438, Massachusetts Institute of Technology (MIT), Department of Economics.
    4. Laffont, Jean-Jacques & Tirole, Jean, 1988. "The Dynamics of Incentive Contracts," Econometrica, Econometric Society, vol. 56(5), pages 1153-1175, September.
    5. Gibbons, Robert, 1988. "Learning in Equilibrium Models of Arbitration," American Economic Review, American Economic Association, vol. 78(5), pages 896-912, December.
    6. Bloom, David E & Cavanagh, Christopher L, 1987. "Negotiator Behavior under Arbitration," American Economic Review, American Economic Association, vol. 77(2), pages 353-358, May.
    7. Henry S. Farber & Max H. Bazerman, 1987. "Divergent Expectations as a Cause of Disagreement in Bargaining: Evidence from a Comparison of Arbitration Schemes."," NBER Working Papers 2139, National Bureau of Economic Research, Inc.
    8. Crawford, Vincent P, 1982. "A Theory of Disagreement in Bargaining," Econometrica, Econometric Society, vol. 50(3), pages 607-637, May.
    9. Farber, Henry S & Bazerman, Max H, 1987. "Why Is There Disagreement in Bargaining?," American Economic Review, American Economic Association, vol. 77(2), pages 347-352, May.
    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. Richard P. Chaykowski, 2019. "Time to Tweak or Re-boot? Assessing the Interest Arbitration Process in Canadian Industrial Relations," C.D. Howe Institute Commentary, C.D. Howe Institute, issue 539, April.
    2. Amy Farmer Curry & Paul Pecorino, 1993. "The Use of Final Offer Arbitration as a Screening Device," Journal of Conflict Resolution, Peace Science Society (International), vol. 37(4), pages 655-669, December.
    3. 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.
    4. David Card & Brian P. McCall, 2009. "When to Start a Fight and When to Fight Back: Liability Disputes in the Workers' Compensation System," Journal of Labor Economics, University of Chicago Press, vol. 27(2), pages 149-178, April.
    5. John W. Budd & Aaron Sojourner & Jaewoo Jung, 2017. "Are Voluntary Agreements Better? Evidence from Baseball Arbitration," ILR Review, Cornell University, ILR School, vol. 70(4), pages 865-893, August.
    6. Bradley R. Weinberg, 2020. "Third-Party Intervention and the Preservation of Bargaining Relationships," ILR Review, Cornell University, ILR School, vol. 73(2), pages 498-527, March.
    7. Michele Campolieti & Chris Riddell, 2019. "Interest Arbitration and the Narcotic Effect: Evidence from Three Decades of Collective Bargaining in Ontario," British Journal of Industrial Relations, London School of Economics, vol. 57(3), pages 421-452, September.

    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. Bester, Helmut & Strausz, Roland, 2007. "Contracting with imperfect commitment and noisy communication," Journal of Economic Theory, Elsevier, vol. 136(1), pages 236-259, September.
    2. Didier Laussel & Ngo Long & Joana Resende, 2022. "Asymmetric Information and Differentiated Durable Goods Monopoly: Intra-Period Versus Intertemporal Discrimination," Dynamic Games and Applications, Springer, vol. 12(2), pages 574-607, June.
    3. Raffaele Fiocco & Roland Strausz, 2015. "Consumer Standards as a Strategic Device to Mitigate Ratchet Effects in Dynamic Regulation," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 24(3), pages 550-569, September.
    4. Pascal Courty & Li Hao, 2000. "Sequential Screening," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 67(4), pages 697-717.
    5. Kjell Hausken, 1997. "Game-theoretic and Behavioral Negotiation Theory," Group Decision and Negotiation, Springer, vol. 6(6), pages 511-528, December.
    6. Kalyan Chatterjee & Gary L. Lilien, 1984. "Efficiency of Alternative Bargaining Procedures," Journal of Conflict Resolution, Peace Science Society (International), vol. 28(2), pages 270-295, June.
    7. Kartasheva, Anastasia V., 2012. "Design of investment promotion policies," International Journal of Industrial Organization, Elsevier, vol. 30(2), pages 127-136.
    8. repec:hum:wpaper:sfb649dp2012-055 is not listed on IDEAS
    9. Juan-Pablo Montero, 2004. "A Model of Arbitration in Regulation," Documentos de Trabajo 267, Instituto de Economia. Pontificia Universidad Católica de Chile..
    10. Hao Zhang & Mahesh Nagarajan & Greys Sošić, 2010. "Dynamic Supplier Contracts Under Asymmetric Inventory Information," Operations Research, INFORMS, vol. 58(5), pages 1380-1397, October.
    11. Markus Arnold & Florian Elsinger & Frederick W. Rankin, 2021. "The Unintended Consequences of Headquarters’ Involvement in Decentralized Transfer Price Negotiations: Experimental Evidence," Management Science, INFORMS, vol. 67(12), pages 7912-7931, December.
    12. Robert Shimer & Ivan Werning, 2019. "Efficiency and information transmission in bilateral trading," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 33, pages 154-176, July.
    13. Kumar, Praveen & Langberg, Nisan, 2013. "Information manipulation and rational investment booms and busts," Journal of Monetary Economics, Elsevier, vol. 60(4), pages 408-425.
    14. Armstrong, Mark & Sappington, David E.M., 2007. "Recent Developments in the Theory of Regulation," Handbook of Industrial Organization, in: Mark Armstrong & Robert Porter (ed.), Handbook of Industrial Organization, edition 1, volume 3, chapter 27, pages 1557-1700, Elsevier.
    15. David Dickinson & Lynn Hunnicutt, 2010. "Nonbinding recommendations: the relative effects of focal points versus uncertainty reduction on bargaining outcomes," Theory and Decision, Springer, vol. 69(4), pages 615-634, October.
    16. Jiadong Gu, 2024. "Data Trade and Consumer Privacy," Papers 2406.12457, arXiv.org, revised Jan 2026.
    17. James J. Murphy & Ariel Dinar & Richard E. Howitt & Erin Mastrangelo & Stephen J. Rassenti & Vernon L. Smith, 2006. "Mechanisms for Addressing Third-Party Impacts Resulting From Voluntary Water Transfers," Chapters, in: John A. List (ed.), Using Experimental Methods in Environmental and Resource Economics, chapter 5, Edward Elgar Publishing.
    18. Francisco Silva, 2020. "Self-evaluations," Documentos de Trabajo 554, Instituto de Economia. Pontificia Universidad Católica de Chile..
    19. Olivier Bochet & Manshu Khanna & Simon Siegenthaler, 2024. "Beyond Dividing the Pie: Multi-Issue Bargaining in the Laboratory," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 91(1), pages 163-191.
    20. Heggedal, Tom-Reiel & Helland, Leif & Våge Knutsen, Magnus, 2022. "The power of outside options in the presence of obstinate types," Games and Economic Behavior, Elsevier, vol. 136(C), pages 454-468.
    21. Laussel, Didier & Long, Ngo Van & Resende, Joana, 2020. "Quality and price personalization under customer recognition: A dynamic monopoly model with contrasting equilibria," Journal of Economic Dynamics and Control, Elsevier, vol. 114(C).

    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:sae:jocore:v:34:y:1990:i:1:p:151-167. 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: SAGE Publications (email available below). General contact details of provider: http://pss.la.psu.edu/ .

    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.