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- W2294051630 abstract "Facing a powerful union enables a firm to obtain more wage flexibility and increases the workers' investment. Hence, when the firm must invest, there are costs and benefits of union power. Under the threat of a takeover cutting the wage bill, the workers' investment is restricted and the workers' effort and wages increase with the incumbent manager's bargaining power. When it is necessary and possible, the workers make a wage concession to prevent such a takeover. When the project is infinitely repeated, implicit labour contracts can be agreed on thanks to a loss of the net present value of the firm in case of breach. The workers' investment increases with the discount factor and the union's ability to retaliate, but not necessarily with the union's static bargaining power. The threat of a takeover led by either a tough or a soft raider restricts the set of implicit labour contracts." @default.
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- W2294051630 date "1994-11-01" @default.
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- W2294051630 title "Implicit Contracts, Optimal Union Power and Takeovers" @default.
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