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Labor union bargaining and firm organizational structure

Published on Oct 1, 2013in Labour Economics1.327
· DOI :10.1016/j.labeco.2013.08.001
Aekapol Chongvilaivan7
Estimated H-index: 7
(ADB: Asian Development Bank),
Jung Hur8
Estimated H-index: 8
(Sogang University),
Yohanes E. Riyanto13
Estimated H-index: 13
(NTU: Nanyang Technological University)
Abstract
Bargaining sequences, though vital to the real-world business strategies, are often treated as exogenously given. We examine bargaining sequences in the setting where a downstream firm makes a merger decision with an upstream partner and faces a negotiation with a union. When the downstream firm's power in the wage bargaining is weak, separation results and the input price bargaining proceeds prior to the wage bargaining. When the downstream firm's power in both negotiations is relatively equal, firms opt for separation and both negotiations keep on simultaneously. When the downstream firm's power in the wage negotiation is strong, the firms merge.
  • References (26)
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