The aim of this project is to develop and empirically test strategic bargaining models applied to union contract negotiations. This work follows the recent developments in the understanding of bargaining inefficiencies and processes in noncooperative bargaining theory. Inefficiencies such as strikes and other costly delays are usually explained by incomplete information about some aspect critical to reaching agreement. It is important to test the validity of such models, and labor negotiations provide a natural and important area for such tests. For the most part, empirical work has ignored the delay option, focusing solely on strikes. This work will fill that gap -- preliminary analyses show that in fact, the signaling role of delay may be just as important as the role of strikes, regardless of the duration of the contract or the magnitude of the bargaining costs. The noncooperative bargaining models that will be developed in this research include several institutional features: strike or delay and finite duration contracts. Testing the predictions of the models will involve a data set on negotiations with 6,000 contracts.
