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Multi-union bargaining: Tariff plurality and tariff competition

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  • Aghadadashli, Hamid
  • Wey, Christian

Abstract

We study sequential bargaining between two unions and a single firm. Parties bargain bilaterally and efficiently (over wage and employment). The unions' workforces can be substitutable (tariff competition) or complementary (tariff plurality or craft unionism). If unions are substitutable, then too many workers from the first union are employed at the cost of employment from the second union (with overall overemployment). If unions are complementary, then employment of both unions is reduced (with overall underemployment). Unions merge when workers are substitutable but stay separate if complementary, so that the inefficiencies associated with craft unionism persist.

Suggested Citation

  • Aghadadashli, Hamid & Wey, Christian, 2014. "Multi-union bargaining: Tariff plurality and tariff competition," DICE Discussion Papers 138, Heinrich Heine University Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    • Handle: RePEc:zbw:dicedp:138
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    References listed on IDEAS

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    More about this item

    JEL classification:

    • D42 - Microeconomics - - Market Structure, Pricing, and Design - - - Monopoly
    • J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
    • L12 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Monopoly; Monopolization Strategies

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