Strategic Managerial Incentives in an Unionized Duopoly
No 1992018, Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) from Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES)
This note reconsiders the problem of managerial incentives in the context of an unionized Nash-Cournot oligopoly. It is hightlighted that managerial incentives weaken union power at industry equilibrium, although, as a symptom of a prisoner dilemma, unions are not reluctant to the existence of those managerial contracts. A direct consequence of this finding is that the adequate employer’s utility function when modelling wage negotiation outcomes should be different from simple firm profit-maximization.
Keywords: management; trade unions; monopolies (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:ctl:louvir:1992018
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