Decentralized versus collective bargaining – an experimental study

Decentralized versus collective bargaining – an experimental study

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Article ID: iaor2003679
Country: Germany
Volume: 30
Issue: 3
Start Page Number: 437
End Page Number: 448
Publication Date: Jan 2001
Journal: International Journal of Game Theory
Authors: , , ,
Keywords: bargaining
Abstract:

Two parties X, and Y, can either bargain separately with a third party Z or merge to become XY and bargain collectively with Z. Depending on the payoff implications of the two possible contracts and on the asymmetry inherent in the conflict payoffs of X and Y collective bargaining will increase, decrease or leave constant what X and Y achieve together. In the experiment, first X and Y vote for or against collective bargaining and then negotiate accordingly. Participants react adequately to strategic aspects, but not as predicted by the (Nash-)bargaining solution.

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