Which of the following is the best theoretical explanation for why strikes occur?
A) The firm has a downward-sloped resistance curve.
B) The union and firm know that it is impossible to eventually negotiate an outcome on the contract curve.
C) The union's leadership wants to please management.
D) The union does not know how valuable labor is to the firm.
E) The firm wants to minimize labor costs.

Question

Quizplus · Accepted Answer

Strikes often occur because the union does not have complete information about how valuable labor is to the firm, leading to disagreements on wages and conditions.

Which of the Following Is the Best Theoretical Explanation for Why