Strikes, Free Riders, and Social Customs

This paper applies the social custom model developed by Akerlof 1980 to the problem of explaining the logic of collective strike action. The paper demonstrates the possibility of stable long-run equilibrium levels of support for a strike. We also show that the model can be applied to the issue of explaining the existence of a trade union, and builds on the results of Booth 1985 in explaining stable intermediate equilibrium membership. The paper does not claim to provide a general theory of strikes, but demonstrates the value of the social custom approach in enhancing the understanding of this class of labor market behavior.