An Empirical Study of Strikes and Wages

Abstract

Is there a systematic relation between wage rates and strike out- cones? This paper addresses the question using a panel of over 2,000 collective bargaining agreements from the Canadian manufacturing sector. Contrary to the implications of recent signalling and sequential bargaining models, there is no correlation between contract real wage rates and strike duration or incidence. Furthermore, lagged strike out- comes do not affect future wage settlements. On the other hand, there is some evidence that contract wages affect future strike outcomes, and also that lagged strike outcomes affect future strike probabilities.