Union militancy and the probability of strikes
The paper provides a model that explains the probability of strikes by the union's use of militancy as a strategic tool in bargaining. Militants are useful because they provide a credible threat, hence enhancing the union's bargaining position. Using a multi-stage bargaining game, we show that, in general, militants will be used by the union as a strategic tool. The strategic benefit of militancy is reflected by the fact that the wage and employment level will be higher in a union that uses militants, compared to a union that does not. We use the model to show that the level of militancy and the probability of a strike decrease with the union's power. This suggests that policies that increase the strength of the union will have, at least, a partial positive effect on social welfare. We also show that the model can be viewed as providing an equilibrium of a repeated game, an interpretation that can explain the probability of strikes even in the absence of militants.
|Date of creation:||2004|
|Contact details of provider:|| Postal: 4700 Keele Street, Toronto, Ontario, M3J 1P3|
Phone: (416) 736-5083
Fax: (416) 736-5987
Web page: http://dept.econ.yorku.ca/
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Atkinson, Scott E & Sandler, Todd & Tschirhart, John, 1987. "Terrorism in a Bargaining Framework," Journal of Law and Economics, University of Chicago Press, vol. 30(1), pages 1-21, April.
- Svejnar, Jan, 1986.
"Bargaining Power, Fear of Disagreement, and Wage Settlements: Theory and Evidence from U.S. Industry,"
Econometric Society, vol. 54(5), pages 1055-1078, September.
- SVEJNAR, Jan, "undated". "Bargaining power, fear of disagreement, and wage settlements: theory and evidence from U.S. industry," CORE Discussion Papers RP 720, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Svejnar, J., 1984. "Bargaining power, fear of disagreement and wage settlements: theory and evidence from U.S. industry," CORE Discussion Papers 1984037, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Booth, Alison & Cressy, Robert, 1990. "Strikes with Asymmetric Information: Theory and Evidence," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 52(3), pages 269-291, August.
- S. Brock Blomberg & Gregory D. Hess & Akila Weerapana, 2004. "An Economic Model of Terrorism," Conflict Management and Peace Science, Peace Science Society (International), vol. 21(1), pages 17-28, February.
- Blomberg, S. Brock & Hess, Gregory D. & Weerapana, Akila, 2004. "Economic conditions and terrorism," European Journal of Political Economy, Elsevier, vol. 20(2), pages 463-478, June.
- Brander, James A. & Lewis, Tracy R., 1986. "Oligopoly and Financial Structure: The Limited Liability Effect," American Economic Review, American Economic Association, vol. 76(5), pages 956-970, December.
- Booth, Alison & Cressy, Robert, 1990. "Erratum [Strikes with Asymmetric Information: Theory and Evidence]," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 52(4), pages 492-492, Special I.
- Martin J. Osborne & Ariel Rubinstein, 2005. "Bargaining and Markets," Levine's Bibliography 666156000000000515, UCLA Department of Economics.
- Hayes, Beth, 1984. "Unions and Strikes with Asymmetric Information," Journal of Labor Economics, University of Chicago Press, vol. 2(1), pages 57-83, January.
- Appelbaum, Elie, 2008. "Extremism as a strategic tool in conflicts," Journal of Economic Behavior & Organization, Elsevier, vol. 68(2), pages 352-364, November.
- Simon P. Anderson & Michael Devereux, 1989. "Profit-Sharing and Optimal Labour Contracts," Canadian Journal of Economics, Canadian Economics Association, vol. 22(2), pages 425-433, May.
- Ronald Wintrobe, 2006. "Extremism, suicide terror, and authoritarianism," Public Choice, Springer, vol. 128(1), pages 169-195, July.
- Glazer, Amihai & Gradstein, Mark & Konrad, Kai A, 1998. "The Electoral Politics of Extreme Policies," Economic Journal, Royal Economic Society, vol. 108(451), pages 1677-1685, November.
- Glazer, A. & Konrad, K.A., 1995. "The Electoral Politics of Extreme Policies," Papers 94-95-23, California Irvine - School of Social Sciences.
- Oswald, Andrew J, 1982. "Trade Unions, Wages and Unemployment: What Can Simple Models Tell Us?," Oxford Economic Papers, Oxford University Press, vol. 34(3), pages 526-545, November.
- Appelbaum, Elie, 1993. "Government policy and the firm's capital structure," European Economic Review, Elsevier, vol. 37(6), pages 1185-1196, August.
- Wintrobe,Ronald, 2012. "Rational Extremism," Cambridge Books, Cambridge University Press, number 9781107407220, March.
- Wintrobe,Ronald, 2006. "Rational Extremism," Cambridge Books, Cambridge University Press, number 9780521859646, December.
- Dixit, Avinash, 1980. "The Role of Investment in Entry-Deterrence," Economic Journal, Royal Economic Society, vol. 90(357), pages 95-106, March.
- Dixit, Avinash, 1979. "The Role of Investment in Entry-Deterrence," The Warwick Economics Research Paper Series (TWERPS) 140, University of Warwick, Department of Economics.
- 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.
- Dirk Rubbelke, 2005. "Differing motivations for terrorism," Defence and Peace Economics, Taylor & Francis Journals, vol. 16(1), pages 19-27.
- Besancenot, Damien & Vranceanu, Radu, 1999. "A trade union model with endogenous militancy: interpreting the French case," Labour Economics, Elsevier, vol. 6(3), pages 355-373, September.
- 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 149-173, April.
- Joseph S. Tracy, 1986. "An Empirical Test of an Asymmetric Information Model of Strikes," NBER Working Papers 1870, National Bureau of Economic Research, Inc.
- Oliver Hart, 1989. "Bargaining and Strikes," The Quarterly Journal of Economics, Oxford University Press, vol. 104(1), pages 25-43.
- 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 262-271, June. Full references (including those not matched with items on IDEAS)
When requesting a correction, please mention this item's handle: RePEc:yca:wpaper:2004_4. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Support)
If references are entirely missing, you can add them using this form.