10.2190/BPAG-2924-9XM4-0L30 BPAG29249XM40L30 149 PUBLIC-SECTOR COLLECTIVE BARGAINING: LESSONS FROM GAME THEORY 149 157 20031029 20031029 20031029 20031029 BPAG29249XM40L30.pdf http://baywood.metapress.com/link.asp?target=contribution&id=BPAG29249XM40L30 2 LAWRENCE J. HABER JOHN WELLINGTON Indiana-Purdue University at Fort Wayne Negotiations between management of a company or agency and unions representing its workers recur at more or less regular intervals over time. In each of the negotiations, each party has the incentive to cooperate with the other for mutual benefit, and simultaneously, the incentive to seek gain at the other's expense. The authors analyze these incentives in the context of a repeating series of Prisoner's Dilemma games. The conclusion drawn is that cooperative bargaining relations are most easily maintained when threats made are credible and, yet, when there is sufficient restraint exercised by the parties that trust between them is maintained. A. Dixit and B. Nalebuff, Thinking Strategically, W. W. Norton and Company, New York, 1991. See D. A. Dilts and C. R. Deitsch, Labor Relations, Macmillan Publishing Company, New York, 1983. See for example, Mike Fish, Business as Usual: Baseball Owners, Players Fan Flames of Distrust, CNN Sports Illustrated Online, February 1, 2002, http://sportsillustrated. cnn.com/inside_game/mike_fish/news/2002/02/01/fish_viewpoint/ B. Rubin and R. Rubin, Municipal Service Delivery, Collective Bargaining, and Labor Management Partnerships, Journal of Collective Negotiations in the Public Sector, 30:2, pp. 91-112, 2003. J. Kelleher, Understandings of Collaboration in Teacher Contract Negotiation and Implementation, Journal of Collective Negotiations in the Public Sector, 30:1, pp. 23-46, 2003. See also R. Axelrod, The Evolution of Cooperation, Basic Books, New York, 1984.