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Keywords:

  • experiments;
  • trade unions;
  • ultimatum bargaining;
  • wages;
  • C92;
  • C78;
  • J51;
  • J52

ABSTRACT

We present an ultimatum wage bargaining experiment showing that a trade union facilitating non-binding communication among workers, raises wages by simultaneously increasing employers’ posted offers and toughening the bargaining position of employees, without reducing overall market efficiency.