Why Are There Strikes?

Kyung nok Chun, Zachary Schaller and Stergios Skaperdas

Revue d'économie politique, 2020, vol. 130, issue 6, 929-956

Abstract: Strikes, just as other types of conflict, used to be difficult to explain from an economic perspective. Initially, it was thought that they were a result of mistakes or irrationality. Then, during the 1980s an explosion of research brought asymmetric information to prominence as a significant cause of strikes. After reviewing such long-standing potential explanations, we go over some more recent ones. When a strike changes the future strategic positions of unions relative to firms compared to a bargain, then a strike can ensue; significantly, the more important the future is considered to be (i.e., the higher is the discount factor), the more likely a strike is. In a new model we show how solidarity based on identification with the union can lead to strikes. Additionally, power asymmetries, reputation-building, and internal union politics can account for strikes within a rational-choice, economic perspective.

Keywords: Unions; Strikes; Dispute Resolution; Bargaining (search for similar items in EconPapers)
Date: 2020
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