Collective Bargaining in the Public Sector: Comment
Abstract
In a recent paper, Janet Currie and Sheena McConnell ( 1991 ), hereafter CM, provide evidence from the Canadian public sector suggesting that requiring binding wage as opposed to granting the right to strike reduces dispute costs but increases wage costs. Disputes are defined as either an or a strike. This leads them to conclude that Pareto dominates other forms of legal structure: both parties could potentially be made better off from the reduction in dispute costs associated with compulsory arbitration and those responsible for designing collective-bargaining legislation face a trade-off between reducing dispute costs and changing the division of the rent (p. 714). They base these important policy conclusions on their empirical evidence on the following relationships:
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