The relative effects of craft-level strikes: The case of airlines

One aspect of bargaining power is the ability of unions to impose losses on firms by striking. Using stock market data from 1963 through 1986, this study tests whether strikes by different crafts have resulted in different losses for airlines. The evidence indicates that strikes by pilots and mechanics initially reduced the share value of struck airlines and that strikes by airline workers in other jobs did not result in significant share value losses. There is no evidence that strikes have imposed permanent losses on air carriers. The authors thank Gordon Karels, David Rosenbaum, and Hendrik Van Den Berg for their helpful comments and thoughtful suggestions. We also thank Jerrold Glass of the Airline Industrial Relations Conference for providing the data on airline strikes.