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Wednesday, July 5, 2006

Collective Bargaining

Collective bargaining used to refer mainly to wage negotiations in which the workforce negotiated collectively rather than individually - typically delegated to special representatives such as trade union officials.

Collective bargaining has always involved a pattern of collective mutual trust known as solidarity, often enforced by formal discipline or social pressure.

A new form of collective bargaining is emerging in China, known as team buying or tuangou, where gangs of customers arrive at a shop and demand high discounts. [source: Economist via Confused of Calcutta]

I wonder how these gangs enforce solidarity? Suppose the gang leader demands a 20% discount, and the shop offers a 10% discount. What if some of the shoppers are happy to accept this? Is there a collective decision process? If a few shoppers accept the deal that the majority has rejected, would this be regarded as a breach of trust?

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