The Library
Bargaining and hold-up : the role of arbitration
Tools
Gabuthy, Yannick and Muthoo, Abhinay (2019) Bargaining and hold-up : the role of arbitration. Oxford Economic Papers, 71 (1). pp. 292-308. gpy035. doi:10.1093/oep/gpy035 ISSN 0030-7653.
|
PDF
WRAP-bargaining-hold-up-role-arbitration-Muthoo-2018.pdf - Accepted Version - Requires a PDF viewer. Download (571Kb) | Preview |
Official URL: https://doi.org/10.1093/oep/gpy035
Abstract
This paper analyses arbitration as a surrogate for complete contracts. We embed this idea in a simple model of a long-term relationship between a rm and its workforce, in which they can make productive-enhancing, relationshipspeci c investments, and then negotiate over the division of the resultant surplus. It is shown that the mere presence of the arbitrator (in the background of negotiations) may enhance investment incentives ex-ante by minimising each party's ability to engage in hold-up behaviours ex-post. Furthermore, we highlight notably that the partners should optimally commit to call an arbitrator ensuring a compromise by awarding a reasonable share of the surplus to the worker. Indeed, this type of arbitrator would harmonise the parties' bargaining powers and then weight their investment incentives optimally.
Item Type: | Journal Article | ||||||||
---|---|---|---|---|---|---|---|---|---|
Subjects: | H Social Sciences > HD Industries. Land use. Labor | ||||||||
Divisions: | Faculty of Social Sciences > Economics | ||||||||
Library of Congress Subject Headings (LCSH): | Arbitration, Industrial, Arbitrators | ||||||||
Journal or Publication Title: | Oxford Economic Papers | ||||||||
Publisher: | Oxford University Press | ||||||||
ISSN: | 0030-7653 | ||||||||
Official Date: | 1 January 2019 | ||||||||
Dates: |
|
||||||||
Volume: | 71 | ||||||||
Number: | 1 | ||||||||
Page Range: | pp. 292-308 | ||||||||
Article Number: | gpy035 | ||||||||
DOI: | 10.1093/oep/gpy035 | ||||||||
Status: | Peer Reviewed | ||||||||
Publication Status: | Published | ||||||||
Reuse Statement (publisher, data, author rights): | This is a pre-copyedited, author-produced version of an article accepted for publication in Oxford Economic Papers following peer review. The version of record Yannick Gabuthy, Abhinay Muthoo; Bargaining and hold-up: the role of arbitration, Oxford Economic Papers, , gpy035, https://doi.org/10.1093/oep/gpy035 is available online at: https://doi.org/10.1093/oep/gpy035 | ||||||||
Access rights to Published version: | Restricted or Subscription Access | ||||||||
Date of first compliant deposit: | 23 August 2018 | ||||||||
Date of first compliant Open Access: | 30 August 2020 | ||||||||
Related URLs: |
Request changes or add full text files to a record
Repository staff actions (login required)
View Item |
Downloads
Downloads per month over past year