Union bargaining power, employment, and output in a model of monopolistic competition with wage bargaining

1997 ◽  
Vol 65 (1) ◽  
pp. 1-17 ◽  
Author(s):  
Amitava Krishna Dutt ◽  
Anindya Sen
Keyword(s):  
Bargaining Power ◽  
Monopolistic Competition ◽  
Wage Bargaining ◽  
Union Bargaining Power

scholarly journals Wage bargaining as an optimal control problem: a dynamic version of the efficient bargaining model

2021 ◽  
Author(s):  
Marco Guerrazzi
Keyword(s):  
Optimal Control ◽  
Continuous Time ◽  
Bargaining Power ◽  
Wage Bargaining ◽  
Bargaining Model ◽  
Speed Of Convergence ◽  
Wage Setting ◽  
Dynamic Version ◽  
Efficient Bargaining ◽  
Over Time

AbstractIn this paper, I develop a dynamic version of the efficient bargaining model grounded on optimal control in which a firm and a union bargain over the wage in a continuous-time environment under the supervision of an infinitely lived mediator. Overturning the findings achieved by means of a companion right-to-manage framework, I demonstrate that when employment is assumed to adjust itself with some attrition in the direction of the contract curve implied by the preferences of the two bargainers, increases in the bargaining power of the firm (union) accelerate (delay) the speed of convergence towards the stationary solution. In addition, confirming the reversal of the results obtained when employment moves over time towards the firm’s labour demand, I show that the dynamic negotiation of wages tends to penalize unionized workers and favour the firm with respect to the bargaining outcomes retrieved with a similar static wage-setting model.

scholarly journals Inequality between capital and labour and among wage-earners: the role of collective bargaining and trade unions

2021 ◽  
Vol 27 (1) ◽  
pp. 29-46
Author(s):  
Maarten Keune
Keyword(s):  
Collective Bargaining ◽  
Wage Inequality ◽  
Trade Unions ◽  
Bargaining Power ◽  
Union Density ◽  
General Terms ◽  
Union Bargaining Power ◽  
Wage Earners ◽  
The Relationship

In the context of rising inequality between capital and labour and among wage-earners in Europe, this state-of-the-art article reviews the literature concerning the relationship between collective bargaining and inequality. It focuses on two main questions: (i) what is the relationship between collective bargaining, union bargaining power and inequality between capital and labour? and (ii) what is the relationship between collective bargaining, union bargaining power and wage inequality among wage-earners? Both questions are discussed in general terms and for single- and multi-employer bargaining systems. It is argued that collective bargaining coverage and union density are negatively related to both types of inequality. These relationships are however qualified by four additional factors: who unions represent, the weight of union objectives other than wages, the statutory minimum wage, and extensions of collective agreements by governments.

Cost-of-Living Clauses in Union Contracts: Determinants and Effects

ILR Review ◽  
1983 ◽  
Vol 36 (3) ◽  
pp. 447-460 ◽  
Author(s):  
Wallace E. Hendricks ◽  
Lawrence M. Kahn
Keyword(s):  
Bargaining Power ◽  
Cost Of Living ◽  
Inflation Uncertainty ◽  
Wage Inflation ◽  
Union Bargaining Power ◽  
Unanticipated Inflation

This study investigates, for the period 1969–81, the determinants of the incidence and strength of cost-of-living adjustment (COLA) clauses in U.S. manufacturing and the effect of those clauses on wage inflation. The sample includes approximately 5,570 union contracts in over 2,600 bargaining relationships. The authors find that both union bargaining power and inflation uncertainty positively affected the probability that a COLA clause was adopted as well as the strength of the clause adopted. Negatively influencing the incidence and strength of COLA clauses during the period studied were unanticipated changes in an industry's prices. The authors also find evidence that wage inflation was greater under contracts with uncapped COLAs than under all other contracts, a result that also was positively influenced by the amount of unanticipated inflation. From these results, the authors suggest a number of possible trends in the use and effects of COLA clauses.

Upstream Mergers, Downstream Mergers, and Unionized Oligopoly

2005 ◽  
Vol 49 (2) ◽  
pp. 67-74 ◽  
Author(s):  
Shu-Hua Chang
Keyword(s):  
Bargaining Power ◽  
Wage Bargaining ◽  
Damage Effect ◽  
Total Profit ◽  
Unionized Oligopoly ◽  
Vertical Chain ◽  
The Right

In a duopolistic industry characterized by unobserved vertical contracts, and where there are two vertical chains with two upstream manufacturers selling to two downstream retailers, we show that the wage is jointly determined by the union and the firm through bargaining and that the wage bargaining power of the union under different regimes, regardless of whether an upstream merger or a downstream merger takes place, will determine the degree of the welfare damage effect. It is also found that an upstream or a downstream monopolist, regardless of whether it possesses the right to franchise, will exert no impact on the equilibrium outputs and total profit, and will only affect the distribution of profits within the vertical chain.

Union Bargaining Power in the Coal Industry, 1945–1981

ILR Review ◽  
1983 ◽  
Vol 36 (2) ◽  
pp. 214-229 ◽  
Author(s):  
Peter Navarro
Keyword(s):  
Bargaining Power ◽  
Coal Industry ◽  
Postwar Period ◽  
Union Power ◽  
Sharp Decline ◽  
Coal Consumption ◽  
Union Leadership ◽  
Rule Changes ◽  
Union Bargaining Power ◽  
Bargaining Table

In examining the bargaining record of the coal industry since the mid-19405, this paper demonstrates that union power in this industry has fluctuated considerably over the years and then describes the reasons for that fluctuation. The author argues that the level of coal consumption has had a consistently strong effect on the balance of bargaining power throughout the postwar period and that industry profits have also influenced settlements, but to a lesser extent. In recent negotiations, the most important power factor has been the sharp decline in the percentage of coal produced by mines covered by UMW contracts. In addition, not only has pre-strike stockpiling by major consumers blunted the union's strike weapon, but also the weakness of union leadership in recent years has helped to precipitate and prolong strikes. Only the evidence on the union's democratic contract ratification procedure, adopted in 1973, is mixed: although providing a slight strategic advantage to the union on occasion, it has also led to confusion at the bargaining table and contributed to the weakness of the leadership. The author also illustrates the importance of including rule changes in measuring union power.

scholarly journals Labour market flexibility: wage relativities under the Labour Relations Act 1987

1970 ◽  
Vol 13 (2) ◽  
Author(s):  
Walter Grills
Keyword(s):  
Bargaining Power ◽  
Labour Relations ◽  
Union Movement ◽  
Labour Market Flexibility ◽  
Long Run ◽  
Compulsory Arbitration ◽  
State Restructuring ◽  
The Subject ◽  
Union Bargaining Power ◽  
The Welfare State

The abolition of compulsory arbitration means that bargaining power will be essential to achieve superior settlements. Workers will be attracted to stronger unions and there will be ,a change in union structure. The dismantling of the welfare state will mean that workers will come to depend on union bargaining power for protection. The objects of unions and the subject matter of bargaining are no longer restricted, and the union can insist that the employer provide security which was formerly provided by the state. Restructuring the union movement as promoted by the Labour Relations Act will not in the long run lead to greater wage flexibility. Unions will remain occupationally based, and will be parties to occupationally based awards which do not accommodate the economic circumstances of individual industries or employers. There will be a smaller number of more powerful unions holding the national award structure together through bargaining power, rather than by the force of the Arbitration Commission's reasoning.

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