Citation

Discussion Paper Details

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Title: Wage Bargaining in Industries with Market Power

Author(s): Samuel Bentolila, Juan J. Dolado and Atilano Jorge Padilla

Publication Date: July 1994

Keyword(s): Bargaining, Strategic Complementarity, Strategic Substitutability and Wages

Programme Area(s): Human Resources

Abstract: In this paper we develop a fully game-theoretic version of the right-to-manage model of firm-level bargaining where strategic interactions among firms are explicitly recognized. Our main aim is to investigate how equilibrium wages and employment react to changes in the labour and product markets, the business cycle and economic policy. We show that our comparative statics results hinge crucially on the strategic nature of the game, which in turn is determined by the relative bargaining power of unions and managers.

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Bibliographic Reference

Bentolila, S, Dolado, J and Padilla, A. 1994. 'Wage Bargaining in Industries with Market Power'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=987