The trade-off between precommitment and flexibility in trade union wage setting
|Title:||The trade-off between precommitment and flexibility in trade union wage setting||Authors:||Anderson, Simon P.
Devereux, Michael B.
|Permanent link:||http://hdl.handle.net/10197/1476||Date:||1990||Online since:||2009-10-05T13:43:39Z||Abstract:||This paper examines two types of contract structures in a model where a trade union supplies labor to an industry, and sets the wage to maximize welfare. Firms' investment is endogenous, and the industry price is stochastic. Under short-term contracts, the union sets the wage after the firms' investment is in place, but also after the industry price is known. Under long- term contracts, the wage is chosen before investment and before the industry price is known. With short-term contracts the union has the benefit of ex-post wage flexibility, while under long-term contracts the union has the benefit of advance wage commitment which may be an important determinant of contract structure. The trade-off is examined in detail.||Item notes:||A hard copy is available in UCD Library at GEN 330.08 IR/UNI||Funding Details:||Social Sciences and Humanities Research Council of Canada||Type of material:||Working Paper||Publisher:||University College Dublin. School of Economics||Series/Report no.:||UCD Centre for Economic Research Working Paper Series; WP90/7||Subject LCSH:||Labor unions
Labor market--Econometric models
|Language:||en||Status of Item:||Not peer reviewed|
|Appears in Collections:||Economics Working Papers & Policy Papers|
Show full item record
Page view(s) 50106
This item is available under the Attribution-NonCommercial-NoDerivs 3.0 Ireland. No item may be reproduced for commercial purposes. For other possible restrictions on use please refer to the publisher's URL where this is made available, or to notes contained in the item itself. Other terms may apply.