Strikes and labour conflicts

Strike activity across advanced economies declined steadily from the 1970s onwards, but since 2020 there is a break in the trend as disruptive disputes in transport and other sectors are returning to the headlines. This chapter reviews the economics of strikes and labour conflict. It begins by defining collective disputes and the three dimensions of strike activity - incidence, size and duration - reviewing the institutional rules that govern the right to strike across the G7 and documenting long-run trends and cyclical patterns. It then sets out the principal theoretical models: Hicks's account of strikes as bargaining failures, the Ashenfelter-Johnson model, asymmetric information models, and the joint cost approach. A survey of the empirical literature follows, covering the cyclicality of strike activity, the costs of strikes, and the influence of regulation. The chapter argues that the recent uptick calls for fresh empirical work, since existing evidence rests largely on data from earlier decades.