This paper provides novel evidence on the role of labor unions in firms’ corporate cash policy. Examining unionization rates firms across 29 countries for period 2004–2015, we show that respond to an increase rate by decreasing their holdings. The reported effect is symmetric, increases (decreases) (increasing) buffers. These results are consistent with bargaining hypothesis, namely, strategica...

We study the influence of unsecured debt (subordinated debt) on banks’ risk-taking in a contingent claim model where assets are risky claims. consider bargaining between stockholders and debtholders when choosing level asset risk. Replacing part bank's stock with subordinated leads to risk-shifting events occurring narrower domain values (leverage ratios), but can lead higher levels risk, depen...

This paper considers the relationship between work status and decision-making power of the head of household and his spouse. I use household fixed effects models to address the possibility that spousal work status maybe correlated with unobserved factors that also affect bargaining power within the home. Consistent with the hypothesis that greater economic resources yield greater bargaining pow...

This paper develops a public choice model of the bargaining power of teachers' unions. The model predicts that the power of the unions rises with the number of eligible voters in a district. As a bargaining outcome reflecting this power, we use the experience premium for teachers. The premium is defined as the difference in salary between experienced and inexperienced teachers. For a sample of ...

The paper has benefited greatly from comments by an anonymous referee and numerous seminar participants as well as discussions with Abstract We ask how bargainers' incentives to communicate about more efficient widget designs depend on whether they negotiate price prior to, or after, fixing the traded design. We find three effects: (1) Since communication reveals information about preferences, ...

Buyers’ Alliances for Bargaining Power by Suchan Chae and Paul Heidhues We provide a novel explanation as to why forming an alliance of buyers (or sellers) across separate markets can be advantageous when input prices are determined by bargaining. Our explanation helps to understand the prevalence of buyer cooperatives among small and medium sized firms.

In experimental tests of human behavior in unstructured bargaining games, typically many joint utility outcomes are found to occur, not just one. This suggests we predict the outcome of such a game as a probability distribution. This is in contrast to what is conventionally done (e.g, in the Nash bargaining solution), which is predict a single outcome. We show how to translate Nash’s bargaining...

This paper studies the impact of gender on frequency of use of influence strategies, amount of power and authoritarianism, using a sample of 109 managers from two organizations in India. Seven downward influence strategies (assertiveness, bargaining, coalition, friendliness, higher authority, reason, and sanctions) and five power bases (reward, referent, legitimate, expert, and coercive) were i...

We introduce a model of bargaining among groups, and characterize a family of solutions using a Consistency axiom and a few other invariance and monotonicity properties. For each solution in the family, there exists some constant α ≥ 0 such that the "bargaining power" of a group is proportional to cα, where c is the cardinality of the group. Subject classification: JEL C71, C78

It is widely accepted among axiomatic bargaining theorists that if one bargainer is more risk averse than a second, the second will be a tougher bargaining opponent than the first against all opponents. We argue that this relationship between risk aversion and bargaining toughness is both highly fragile, and more nuanced than previously articulated. In the Nash and Kalai-Smorodinsky bargaining ...