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Firms' debt and finite-horizon wage bargaining

Dalmazzo, Alberto (1991) Firms' debt and finite-horizon wage bargaining. CEP discussion paper (54). Centre for Economic Performance, London School of Economics and Political Science, London, UK.

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The simple bargaining mode presented here analyses the effect of a predetermined level of debt repayment commitments on the wage bargaining process between a firm and its workforce. Even if the bargaining process between a firm and its workforce. Even if the bargaining structure is basically derived from Rubinstein (1982), the presence of debt''s interests maturing over time is shown to imply finiteness in the bargaining horizon. The main consequence is that, in contrast with Rubinstein (1982), the parties'' outside options always enter the perfect equilibrium payoffs, justifying their presence in the econometric specifications.

Item Type: Monograph (Discussion Paper)
Official URL:
Additional Information: © 1991 Alberto Dalmazzo
Divisions: Centre for Economic Performance
Subjects: H Social Sciences > HD Industries. Land use. Labor
Sets: Collections > Economists Online
Research centres and groups > Centre for Economic Performance (CEP)
Series: Working Papers > CEP Discussion Papers
Date Deposited: 21 Aug 2008 11:22
Last Modified: 28 Feb 2013 13:14

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