Economics, Econometrics and Finance
4 years ago

Union Wages Plummet as Firms Exploit Inventory Stockpiles, Legislation Shift

Wage Bargaining, Inventories, and Union Legislation
Andrew Hildreth, Melvyn Coles

Paper Summary

The article looks at how firms and unions negotiate wages during strikes when firms have unsold goods. The study shows that after 1982, union wages decrease when firms have more inventory, but not before. This change is linked to a shift in the firm's bargaining power due to new laws.

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