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The Effect Of Collective Bargaining Legislation On Strikes And Wages

  • Peter Cramton
  • Morley Gunderson
  • Joseph Tracy

Using Canadian data on large, private-sector contract negotiations from January, 1967, to March, 1993, we find that strikes and wages are substantially influenced by labor policy. The data indicate that conciliation policies have largely been ineffective in reducing strike costs. In contrast, general contract reopener provisions appear to make both unions and employers better off by reducing negotiation costs without systematically affecting wage settlements. Legislation banning the use of replacement workers appears to lead to significantly higher negotiation costs and redistribution of quasi-rents from employers to unions. © 1999 by the President and Fellows of Harvard College and the Massachusetts Institute of Technology

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File URL: http://www.mitpressjournals.org/doi/pdf/10.1162/003465399558238
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Article provided by MIT Press in its journal The Review of Economics and Statistics.

Volume (Year): 81 (1999)
Issue (Month): 3 (August)
Pages: 475-487

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Handle: RePEc:tpr:restat:v:81:y:1999:i:3:p:475-487
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  1. Peter Cramton & Joseph S. Tracy, 1994. "The Determinants of U.S. Labor Disputes," Papers of Peter Cramton 94jole, University of Maryland, Department of Economics - Peter Cramton, revised 09 Jun 1998.
  2. David Card & Craig A. Olson, 1992. "Bargaining Power, Strike Duration, and Wage Outcomes: An Analysis of Strikes in the 1880s," NBER Working Papers 4075, National Bureau of Economic Research, Inc.
  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. Kennan, J. & Wilson, R., 1991. "Bargaining with Private Information," Working Papers 90-01rev, University of Iowa, Department of Economics.
  5. Kennan, John & Wilson, Robert, 1989. "Strategic Bargaining Models and Interpretation of Strike Data," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 4(S), pages S87-130, Supplemen.
  6. 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.
  7. Cramton, Peter C & Tracy, Joseph S, 1994. "Wage Bargaining with Time-Varying Threats," Journal of Labor Economics, University of Chicago Press, vol. 12(4), pages 594-617, October.
  8. Kennan, John, 1985. "The duration of contract strikes in U.S. manufacturing," Journal of Econometrics, Elsevier, vol. 28(1), pages 5-28, April.
  9. Tracy, Joseph S, 1987. "An Empirical Test of an Asymmetric Information Model of Strikes," Journal of Labor Economics, University of Chicago Press, vol. 5(2), pages 149-73, April.
  10. Farber, Henry S, 1978. "Bargaining Theory, Wage Outcomes, and the Occurrence of Strikes: An Econometric Analysis," American Economic Review, American Economic Association, vol. 68(3), pages 262-71, June.
  11. David Card & Craig A. Olson, 1992. "Bargaining Power, Strike Durations, and Wage Outcomes: An Analysis of Strikes in the 1880s," Working Papers 674, Princeton University, Department of Economics, Industrial Relations Section..
  12. Oliver Hart, 1989. "Bargaining and Strikes," The Quarterly Journal of Economics, Oxford University Press, vol. 104(1), pages 25-43.
  13. Tracy, Joseph S, 1986. "An Investigation into the Determinants of U.S. Strike Activity," American Economic Review, American Economic Association, vol. 76(3), pages 423-36, June.
  14. D. A. L. Auld & L. N. Christofides & R. Swidinsky & D. A. Wilton, 1981. "The Effect of Settlement Stage on Negotiated Wage Settlements in Canada," ILR Review, Cornell University, ILR School, vol. 34(2), pages 234-244, January.
  15. Peter C. Cramton, 1992. "Strategic Delay in Bargaining with Two-Sided Uncertainty," Review of Economic Studies, Oxford University Press, vol. 59(1), pages 205-225.
  16. Cynthia L. Gramm, 1986. "The Determinants of Strike Incidence and Severity: A Micro-Level Study," ILR Review, Cornell University, ILR School, vol. 39(3), pages 361-376, April.
  17. Christofides, Louis N & Swidinsky, Robert & Wilton, David A, 1980. "A Microeconometric Analysis of Spillovers within the Canadian Wage Determination Process," The Review of Economics and Statistics, MIT Press, vol. 62(2), pages 213-21, May.
  18. David Card, 1987. "Longitudinal Analysis of Strike Activity," NBER Working Papers 2263, National Bureau of Economic Research, Inc.
  19. Budd, J.W., 1993. "Canadian Strike Replacement Legislation and Collective Bargainig : Lessons for United States," Papers 93-08, Minnesota - Industrial Relations Center.
  20. repec:fth:prinin:294 is not listed on IDEAS
  21. 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.
  22. Ashenfelter, Orley & Johnson, George E, 1969. "Bargaining Theory, Trade Unions, and Industrial Strike Activity," American Economic Review, American Economic Association, vol. 59(1), pages 35-49, March.
  23. McConnell, Sheena, 1989. "Strikes, Wages, and Private Information," American Economic Review, American Economic Association, vol. 79(4), pages 801-15, September.
  24. Harrison, Alan & Stewart, Mark, 1989. "Cyclical Fluctuations in Strike Durations," American Economic Review, American Economic Association, vol. 79(4), pages 827-41, September.
  25. Hayes, Beth, 1984. "Unions and Strikes with Asymmetric Information," Journal of Labor Economics, University of Chicago Press, vol. 2(1), pages 57-83, January.
  26. Vroman, Susan B, 1989. "A Longitudinal Analysis of Strike Activity in U.S. Manufacturing: 1957-1984," American Economic Review, American Economic Association, vol. 79(4), pages 816-26, September.
  27. Currie, Janet & McConnell, Sheena, 1991. "Collective Bargaining in the Public Sector: The Effect of Legal Structure on Dispute Costs and Wages," American Economic Review, American Economic Association, vol. 81(4), pages 693-718, September.
  28. Morley Gunderson & John Kervin & Frank Reid, 1989. "The Effect of Labour Relations Legislation on Strike Incidence," Canadian Journal of Economics, Canadian Economics Association, vol. 22(4), pages 779-94, November.
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