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Effects of Profitable Downsizing on Collective Bargaining

Author

Listed:
  • Sven Fischer

    (Department of Economics, University College London)

  • Werner Güth

    (Max Planck Institute of Economics, Jena)

  • Christoph Köhler

    (Friedrich-Schiller-University Jena, Institute for Sociology, Economic and Social Structure Group)

Abstract

We experimentally test how acceptance thresholds react to the decision of the proposer in a three party ultimatum game to exclude one of two responders with veto power from the game. We elicit responder acceptance thresholds in case the proposer decides to exclude one of them, what increases the available pie, and in case he doesn't exclude him despite strong monetary incentives. We ?nd that on the aggregate level the proposer's decision has no effect on acceptance thresholds. However, if the proposer excludes one responder, the distribution of thresholds becomes bimodal, indicating a polarization in behavior.

Suggested Citation

  • Sven Fischer & Werner Güth & Christoph Köhler, 2008. "Effects of Profitable Downsizing on Collective Bargaining," Jena Economics Research Papers 2008-011, Friedrich-Schiller-University Jena.
  • Handle: RePEc:jrp:jrpwrp:2008-011
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    File URL: https://oweb.b67.uni-jena.de/Papers/jerp2008/wp_2008_011.pdf
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    More about this item

    Keywords

    bargaining; experiment; labor markets;
    All these keywords.

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • J52 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Dispute Resolution: Strikes, Arbitration, and Mediation

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