Manning, Alan 
ORCID: 0000-0002-7884-3580
(1991)
Authority in employment contracts: a bilateral bargaining model.
CEPDP (21).
London School of Economics and Political Science. Centre for Economic Performance, London, UK.
Abstract
This paper takes a model of the employment contract which is incomplete in the sense that the required effort level is not exactly specified when employment is agreed and in which each worker negotiates their own contract with their employer. Given the incompleteness of the employment contract, residual rights of control over labour need to be specified. This paper analyses the allocation of these residual rights of control. It is argued that equilibrium employment contracts will tend to give the employer residual rights of control over labour, if workers are potential substitutes and give workers residual rights of control if workers are complements. However, it may not be the case that the equilibrium contracts maximise the available social surplus; in this case there is an argument for government intervention to regulate the form of employment contracts.
| Item Type: | Monograph (Discussion Paper) |
|---|---|
| Official URL: | http://cep.lse.ac.uk |
| Additional Information: | © 1991 Alan Manning |
| Divisions: | Centre for Economic Performance Economics |
| Subjects: | H Social Sciences > HD Industries. Land use. Labor |
| Date Deposited: | 21 Aug 2008 16:35 |
| Last Modified: | 01 Oct 2024 03:15 |
| URI: | http://eprints.lse.ac.uk/id/eprint/21124 |
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