Work Rules, Featherbedding, and Pareto-Optimal Union Management Bargaining / George E. Johnson.

By:

Johnson, George E

Contributor(s):

National Bureau of Economic Research

Material type: Text

TextSeries: Working Paper Series (National Bureau of Economic Research) ; no. w1820.Publication details: Cambridge, Mass. National Bureau of Economic Research 1986.Description: 1 online resource: illustrations (black and white)Subject(s):

J - Labor and Demographic Economics

Online resources:

Available additional physical forms:

Hardcopy version available to institutional subscribers

Abstract: The recent literature on the economic behavior of unions is dominated by a controversy over whether or not bargaining is Pareto optimal. If unions care about employment as well as wages, efficient bargains between unions and management "should" involve both these variables rather than only wages. In fact, explicit bargaining over employment levels is virtually unknown. There is, however, implicit bargaining over employment in the form of rules concerning the labor/capital ratio, job assignment, work speeds, and the like.This paper examines a model of "semi-efficient" bargaining in which the unionand the firm bargain over wages and various types of work rules. The results are compared to the outcomes that are associated with fully efficient bargaining (i.e, over wages and the level of employment) and bargaining solely over wages. Of particular interest is the case in which the union and the firm mutually consent to "feather bedding" agreements (requiring the hiring of workers with zero marginal product). The major conclusion of the paper is that the outcome of collective bargaining is different in the case of negotiations over work rules and wages than in both the cases of fully efficient bargaining and of bargaining solely over wages. In general, however, the outcome of this "partially efficient" bargaining process is closer to the outcome of bargaining solely over wages than to that associated with fully efficient bargaining over both wages and employment.

Tags from this library: No tags from this library for this title. Log in to add tags.

Average rating: 0.0 (0 votes)

Holdings
Item type	Home library	Collection	Call number	Status	Date due	Barcode	Item holds
Working Paper	Biblioteca Digital	Colección NBER	nber w1820 (Browse shelf(Opens below))	Not For Loan

Total holds: 0

Collection: Colección NBER Close shelf browser (Hides shelf browser)

Previous	No cover image available	No cover image available	No cover image available	No cover image available	No cover image available	No cover image available	No cover image available	Next
Previous	nber w18197 Impact of Bilingual Education Programs on Limited English Proficient Students and Their Peers: Regression Discontinuity Evidence from Texas /	nber w18198 Peer Effects in Program Participation /	nber w18199 Dealing with the Trilemma: Optimal Capital Controls with Fixed Exchange Rates /	nber w1820 Work Rules, Featherbedding, and Pareto-Optimal Union Management Bargaining /	nber w18200 Effects of Federal Policy to Insure Young Adults: Evidence from the 2010 Affordable Care Act Dependent Coverage Mandate /	nber w18201 Evaluating Student Outcomes at For-Profit Colleges /	nber w18202 The Need for (long) Chains in Kidney Exchange /	Next

1986.

The recent literature on the economic behavior of unions is dominated by a controversy over whether or not bargaining is Pareto optimal. If unions care about employment as well as wages, efficient bargains between unions and management "should" involve both these variables rather than only wages. In fact, explicit bargaining over employment levels is virtually unknown. There is, however, implicit bargaining over employment in the form of rules concerning the labor/capital ratio, job assignment, work speeds, and the like.This paper examines a model of "semi-efficient" bargaining in which the unionand the firm bargain over wages and various types of work rules. The results are compared to the outcomes that are associated with fully efficient bargaining (i.e, over wages and the level of employment) and bargaining solely over wages. Of particular interest is the case in which the union and the firm mutually consent to "feather bedding" agreements (requiring the hiring of workers with zero marginal product). The major conclusion of the paper is that the outcome of collective bargaining is different in the case of negotiations over work rules and wages than in both the cases of fully efficient bargaining and of bargaining solely over wages. In general, however, the outcome of this "partially efficient" bargaining process is closer to the outcome of bargaining solely over wages than to that associated with fully efficient bargaining over both wages and employment.