Analysis of Labor-Management Negotiation based on Chicken Evolutionary Game and Catastrophe Theory

This paper aims to conduct a research on the labor-management negotiation in a chicken evolutionary game models through catastrophe theory. Both players can compromise or not during the negotiation. The "no compromise" strategy for labor means threat to strike and for management is ignoring labors' demands. Since the model of this research is chicken game, if on player decides to dig in, the optimum decision for other is to compromise, however it is costly to be calling a chicken by the rivals. In the process of evolution, players reevaluate their options to update the payoffs in case of gradual and continuous changes which may happen in effective variables of strategy selection. The continuous changes could cause a catastrophic change in system’s state and its collapse by a strike or lockout. ESS analysis and determining catastrophe threshold in the chicken evolutionary game will be done with the aim of giving managerial insights that help the players to prevent making decisions that could cause unsuccessful negotiation.