A simultaneous-equations model of the relationship between public sector bargaining legislation and unionization

This paper estimates a simultaneous-equations model with public sector bargaining laws and union membership treated as jointly-determined variables. The extent of public sector unionization has a significant positive influence on the passage of prolabor bargaining legislation and bargaining legislation has strong, independent effects on the extent of public sector unionization. We gratefully acknowledge the research support provided by Minbo Kim and Parisun Chantonahom.     

Wages,union membership,and public sector bargaining legislation: Simultaneous equations with an ordinal qualitative variable

A simultaneous equations model of teachers’ wages and unionization is constructed. The exogenous impact of collective bargaining legislation is captured by conditioning the wage-union system on an ordinal qualitative variable. A new estimation method involving N-chotomous probit and two-stage least squares is developed. The estimation results are consistent with a private interest theory of regulation, predicting that legislators will avoid direct subsidization of teacher wages. By comparison it is also shown that a conventional dummy variable specification of the qualitative legislative outcomes will yield misleading results. The authors gratefully acknowledge the helpful comments of John Addison, Cletus Coughlin, and Robert P. Trost.     

Partially monotonic bargaining solutions

The purpose of the paper is to study partially monotonic solutions for two-person bargaining problems. Partial monotonicity relates to the uncertainty a player has about the solution before bargaining. If the minimum utility a player can expect is greater in game T than in game S, and if T contains more alternatives than S, this may bring him to expect that his utility at the solution is greater in T than in S. Partially monotonic solutions reflect these expectations.One partially monotonic solution is axiomatized. The axioms of symmetry and independence of linear transformations are not explicitly assumed, although the solution has also these properties. The Kalai-Smorodinsky solution is shown to be the only continuous partially monotonic solution.This study was financed by the Yrjö Jahnsson Foundation, which is gratefully acknowledged. I like to thank an associate editor and a referee for their valuable suggestions, and the Yrjö Jahnsson Foundation Study Group on Public Economics for useful discussions     

The replacement principle in bargaining

We investigate the implications of the principle of welfare-domination under preference-replacement or replacement in the context of bargaining. It requires that changes in the preferences of some agents, unaccompanied by changes in the resources, should affect all of the agents whose preferences have not changed in the same direction: all gain or all lose together. We begin with investigating the logical relations between replacement and two monotonicity axioms, weak monotonicity and population monotonicity. Then, we establish characterizations of the Kalai–Smorodinsky and egalitarian solutions on the basis of replacement. On the other hand, we obtain impossibility results if Pareto optimality and replacement are imposed together with either strong individual rationality or symmetry. This work was supported by the Brain Korea 21 Project in 2003. I am grateful to William Thomson, Hyungjun Kim, a referee, and an associate editor for their valuable comments.

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How employee empowerment influences organization–employee relationship in China

The current study examines how employees’ perceptions of empowerment impact the quality of the organization–employee relationship. Based on the on-line survey of 223 employees from a variety of companies in China, both dimensions of employee empowerment—feelings of competence and feelings of control—serve as positive predictors for organization–employee relationship. However, employees’ feelings of control wield more weight in the prediction than do feelings of competence.