An economic analysis of public sector collective bargaining and strike activity

This paper develops a theory of public sector collective bargaining and uses it to investigate the economic determinants of public sector strike activity. The model considers union leaders, union members, bureaucrats, politicians, and voters, with the intention of explicitly recognizing both the constraints placed on the bargaining parties by their constituents and the differences between public and private sector collective bargaining. The empirical results indicate that only in cases where both negotiating parties are motivated by self-interest can we expect frequent strikes and strikes of long duration. The results also suggest that public sector strikes are countercyclical and principally influenced by the business cycle and its impact on state and local revenues.     

Strike strategies and the minimum effective union

Research has shown that in an industry-wide strike, a union must be able to reduce output “by a substantial percentage below competitive levels” to impose hardship on producers. But a union may also be effective by pursuing selective strikes. If some producers are struck while others are free to operate, then the targeted producers may bargain with the union, and holdouts can be targeted for strikes. This article analyzes the effects of selective and general strikes on both a competitive industry and a duopoly. If there are side-payments among producers, then general strikes are easier to mount. If there is no mutual aid among employers, then selective strikes are less costly to implement. It is also shown that strikes are easier to mount in a duopoly than in a competitive industry. This may contribute to union formation and collective bargaining in noncompetitive industries. The analysis is modified to allow for firms of different sizes. The results show that unions must be able to remove more output from larger firms than smaller ones, suggesting that union formation may be focused more on larger firms. The author thanks Mark Loewenstein, James Fain, and Campbell McConnell for thoughtful comments and suggestions. The author gratefully acknowledges a research grant from the College of Business Administration of the University of Nebraska. I am responsible for any remaining shortcomings.     

Economic Development and Strikes: A Comparative Analysis*

Theorists of class conflict have debated the nature of the relationship between economic development and the incidence of strikes. The liberal perspective contends that such developments as the growth in size of corporations and the separation of ownership from control enable modern management to institutionalize industrial conflict in the form of collective bargaining. In contrast, writers in the radical perspective argue that conflict will increase in late industrialization owing to such forces as the bi-polarization of classes and an increase in union strength. The present paper tests these structuralist theories by using data from a sampling of seventy-one nations representing a wide range in economic development. A polynomial regression analysis indicates that strike volume, a chief measure of overall strike activity, follows a parabolic curve—increasing until a GNP per capita of about $4,700 is reached and then declining. No support is found for the radical thesis of an upswing in strike activity at high levels of economic development. The findings on control variables indicate that the inflation rate and mass-media development have significantly positive effects on strike activity. Finally, a democratic political climate tends to lower strike volume.     

Police recognition strikes: Illegal and ill-fated

This study investigates the relationship between strike activity by nonunion public employees and unionization. This study examines strike activity and unionization rates of some 600 nonunion municipal police departments from 1972 to 1978 and finds that recognition strikes occur primarily where bargaining laws provide little or no protection of bargaining rights for municipal police. These strikes, however, do not help nonunion police gain recognition. The author thanks John Delaney for helpful comments on this paper.     

Strike Lengths: Correcting for Prestrike Announcements and the Ratio of Bargaining Size to Firm Size

Anticipating the duration of a labor strike can be vital for both sides of the dispute, as well as outside observers. The methods of a pair of studies using Canadian data are surveyed to analyze labor strikes in the United States from 1992 to 2008. Corrections are made for strikes with predetermined lengths (“one-day” strikes and the like), whose durations are more a function of the prior announcements than of other factors, such as number of employees striking and macroeconomic conditions. Strikes are found to be generally shorter when the striking unit represents a larger portion of the firm’s total workers, a proxy for its bargaining power. This ratio provides a better understanding of the strike dynamics (including expected length) than do sheer bargaining unit size or sheer firm size.     

Crossing the line: The determinants of picket line crossing during a faculty strike

This study builds on the strike-militancy literature by examining the determinants of the union member’s decision to cross a picket line during a 29-day university faculty strike. As hypothesized, voting behavior in authorization and ratification elections significantly predicted crossing behavior, suggesting that strike voting may provide information about the level of support for the strike and, in turn, the level of bargaining power. In addition, satisfaction with the administration, union commitment, attitudes toward unions, co-worker social support, and the perceived cost of striking were significantly related to crossing behavior.     

Inter-industry strike frequencies: Some pooled cross-sectional evidence from canadian secondary manufacturing

This note reports the results of a pooled cross-sectional time series regression of strike frequencies in Canadian secondary manufacturing for the years 1969, 1971, and 1974. The basic conclusion is that a bargaining model approach performs well for interpreting work stoppages associated with contract negotiations, but provides a less than satisfactory explanation of mid-term and unorganized strikes. The research reported in this paper was supported by a grant from Labour Canada. We wish to thank Harry Grosskleg of Labour Canada who provided the strike data; Ingrid Strauss, Kathy Meredith, and Mark Muth for research assistance; and Leonard Laudadio and an anonymous referee for helpful comments. The paper is an abbreviated version of Jones and Walsh (1983).     

ON LABOR'S RIGHT TO STRIKE

This paper first shows that, under certain conditions, strikes benefit capital at the expense of union labor in the aggregate. It is then argued that observed variations in strikes and labor's right to strike are largely explainable by variations in the profitability of strikes to capital and not explainable by popular alternative hypotheses purporting to explain the existence of strikes. Finally, an explanation is offered for the persistence of labor's right to strike over time and across various political systems.     

Industrial relations reform in Britain since 1979

Important changes to British industrial relations law were undertaken by the Thatcher and Major governments. A succession of legislative measures narrowed the scope of labor union action in pursuit of a dispute, made unions financially responsible for torts committed by their members, removed government support for collective bargaining, abolished the closed shop, and reformed unions' internal structures. At least in part as a result of these measures, union density and the coverage of collective bargaining have fallen; strikes have become rare; and Britain’s productivity performance has improved. The unions and the Labour Party have largely become reconciled to measures which they initially fiercely opposed, and the influence of these reforms is likely to endure even though the Conservatives have lost office.     

A comparative analysis of strike models during periods of rapid inflation: 1967–1977

This paper examines the ability of the existing strike literature, as typified by the strike models of Ashenfelter and Johnson (1969) and Shalev (1980), to explain the pattern of strike activity in the United States in the period 1967 to 1977. After demonstrating the limited ability of these models to explain the strike activity during this period, an alternative model is proposed which is related to the “Pure Bargaining Theories” that stress the role of economic forces in terms of their effect on uncertainty in the bargaining process.     

AGRICULTURAL LABOR STRIKES AND FARMERS' INCOME

This paper assesses the effectiveness of union strikes against agricultural industries. Various factors including input substitution possibilities create special challenges for union leaders. We develop the concept of a minimum-effective union and apply it empirically to the 1979 California lettuce strike. To be effective, a union has to reduce producer profits below the prestrike level. In the lettuce strike case, producer profits were actually increased, not reduced.     

AFTER TAFT-HARTLEY: The Legal-Institutional Context of U.S. Strike Activity, 1948 to 1980

This article examines how the legal-institutional context created by American labor law has impacted the frequency, issue composition, and economic damage of strike activity since the passage of the Taft-Hartley Act. Emphasis on the legal-institutional context complements conventional perspectives of strike activity which focus on business cycle and political-organizational interpretations. A new labor law index is developed to measure the legal-institutional context, and it is comprised of five components: number of pro-labor laws, National Labor Relations Board unfair labor cases filed, use of antilabor injunctions, labor mediation, and labor arbitration. For the period of 1948 to 1980, high values on the labor law index reduced overall strike frequency, reduced some types of control-related strikes, had no effect on economic strikes, and decreased working time lost to strikes, especially in the monopoly sector. These findings suggest that the legal-institutional context of the post-Taft-Hartley period has served to regulate and delegitimize expressions of labor unrest that most seriously challenge capitalist interests.     

The effect of type of union on member-nonmember wage differentials

The union-nonunion wage differential can be decomposed into bargaining and membership effects. While some analysts suggest that they are not separable and that bargaining power is a function of membership density, others argue that they are separable and that the former derives from monopoly power while the latter stems from socialization. Our results support the latter view. We derive estimates of bargaining and membership effects for workers covered by national, industrial, and craft union contracts as well as for all covered workers taken together. Since industrial and craft unions differ in structure and organization, we expect differences in the socialization effects among types of unions. It is clear from our results that union membership per se in each case gives a large positive wage advantage.     

The union wage effect in Canadian manufacturing industries

Data for Canadian manufacturing industries, at the two-digit level, are used to examine the component elements of the union wage effect. The results show that absence of compulsory union membership for all employees in the bargaining unit served by a union does not significantly impair the ability of the union to negotiate wage gains. That is, our results imply that there is little reason for unions to devote much effort to negotiating the stronger forms of union security — union or closed shops. A second implication of our results is that significant bargaining advantages may accrue to unions with an international (U.S.) link, relative to Canadian national unions.     

An analysis of multi-union elections involving incumbent unions

This article investigates the extent and outcomes of multi-union elections involving incumbent unions between 1974 and 1986. During this 13 year period a total of 1423 raid elections (an average of 109 per year) were conducted. The data reveal that the number of raid elections is declining and that unions, as opposed to no-union, continue to be victorious in the majority of cases, although there is considerable regional, industrial, union, and bargaining unit size variance in union victory rates.     

From union hegemony to union disintegration: Collective bargaining in cement and related industries

The cement industry provides an interesting example of the impact of collective bargaining where management determines that it cannot afford a strike, yields to extreme union demands, but deludes itself that it can withstand the economic impact of unionism under such circumstances because almost all competitors are similarly situated and labor costs can be partially offset by automation. The small Cement, Lime, and Gypsum Workers Union won not only high wages and benefits, but imposed restrictive rules as severe as those in any industry. Eventually, however, foreign competition and economic realities forced the companies to revolt, and the union found that it could not sustain strikes. An ill-conceived merger broke up, an independent union was formed, and today unionism, once so strong, is weak and divided as management imposes or forces acceptance of its conditions. The story, while unique in many ways, resembles what has occurred in other industries with high fixed costs, militant unions, and the reluctance of management to sacrifice current gains for longer run needs. Professor Emeritus of Management and former Director, Industrial Research Unit. Ms. Sue Torelli, Librarian, Industrial Research Unit, and Kevin Barry, Librarian, Industrial Relations Section, Princeton University, provided helpful information and numerous documents.     

Strike activity in the united states: An analysis of the stocks and flows

Evidence indicates that a dichotomy exists between the stocks and flows of strike activity in the United States. Canonical correlation analysis was applied to U.S. strike data from 1955 through 1980 to ascertain whether the economic or sociopolitical models of strikes were more appropriate to the explanation of either the stock or flow of strikes. The economic variables were the most important in explaining variations in the flow while the linear time trend together with the economic variables explained the variations in the stock of strikes. This suggests that strikes begin for economic reasons and that the dimensions of the stock of strikes may be more closely correlated with variables not used in the analysis but exhibit a trend over the period examined, hence a dichotomy between the flow and stock of strike activity.     

Who joins unions in the public sector? The effects of individual characteristics and the law

Analysis of a large micro-data set shows that state public-sector bargaining laws significantly influence state and local government union membership in several ways. Membership probability is lowest where a right-to-work law is present; it is greatest when there are mandatory agency shop provisions. Compulsory arbitration leads to a significantly greater probability of membership than does the right-to-strike. Simulations based on model estimates indicate that policy changes along the lines of proposed national public bargaining laws could lead to major changes in public-sector union density. Among individual and demographic characteristics, membership probability is significantly affected by full-time/part-time status and the statewide extent of private-sector unionism. Although non-whites and males are more likely to be union members, race and gender membership differentials are shown to be relatively small. The author thanks Jack Fiorito, Paul Jarley, Joe Stone, and Rob Valletta for their helpful comments. Any remaining errors are his sole responsibility.     

Consequences of work force reduction: Some employer and union evidence

Despite the popularity of workforce cutbacks in the 1990s, largescale empirical stud-ies at the bargaining unit level are rare. I explore some of the consequences of per-manent work force reduction using data from both employer and union respondents. About 56 percent of employer participants and 57 percent of local union officials reported a permanent reduction of bargaining unit employees. In comparing bargain-ing units that experienced a permanent reduction of union members, results obtained from both employers and union officials indicated a significant negative impact on over-all employee satisfaction and labor climate. Additional analyses with union respon-dents revealed that the reduction of bargaining unit employees was also associated with a higher rate of grievances and absenteeism and poorer relations between union members and their supervisors.     

Government Intervention in Public Sector Industrial Relations: Lessons from the Alberta Teachers’ Association

In the public sector, Canadian governments intervene frequently in labor disputes by suspending collective bargaining and curtailing legal strikes. Previous research has focused on the contours of government intervention, such as its overall effects on collective bargaining and strikes. The discussion highlights one actor, a government, restricting the behavior of another actor, a union, using legislation and policy making. As a result, we know less about more micro-level elements and implications of the process of government intervention. I address these themes using a detailed case study of the Alberta Teachers’ Association and the strikes it coordinated in 2002.