11. The 1978 film Norma Rae is based on a true story about Crystal Lee Sutton...

 

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11. The 1978 film Norma Rae is based on a true story about Crystal Lee Sutton who was a textile worker in Roanoke Rapids, North Carolina. Crystal was inspired to help workers at the J.P Stevens textile mill form a union. In the film and in real life, she stands on her worktable and holds up a sign that says "UNION" and stays there until all of the machines are silent. Though fired from her job, the mill did become unionized, and she later went to work as an organizer for the textile union. In modeling this situation, Norma Rae is assumed to decide whether or not to join the union. Upon observing Norma Rae's choice, the other n 2 1 workers simultaneously choose whether or not to join the union. For all workers (including Norma Rae), the payoff is 2 from not joining, 1 from joining when the fraction of workers who join is less than two-thirds, and 3 from joining when the frac- tion of workers who join is at least two-thirds. Assume that a worker joins the union when she is indifferent about joining.* C 0 3 No 1 4 2 1 14 2 2 3 No 3 5 b. C₁ 2 bz N 1 0 0 3 4621 a. Find the SPNE. (Hint: The answer depends on the value of n). b. Now suppose that payoffs are as follows. For Norma Rae, her payoff from not joining is 0, from joining when at least 2 people join is 1, and 11. The 1978 film Norma Rae is based on a true story about Crystal Lee Sutton who was a textile worker in Roanoke Rapids, North Carolina. Crystal was inspired to help workers at the J.P Stevens textile mill form a union. In the film and in real life, she stands on her worktable and holds up a sign that says "UNION" and stays there until all of the machines are silent. Though fired from her job, the mill did become unionized, and she later went to work as an organizer for the textile union. In modeling this situation, Norma Rae is assumed to decide whether or not to join the union. Upon observing Norma Rae's choice, the other n 2 1 workers simultaneously choose whether or not to join the union. For all workers (including Norma Rae), the payoff is 2 from not joining, 1 from joining when the fraction of workers who join is less than two-thirds, and 3 from joining when the frac- tion of workers who join is at least two-thirds. Assume that a worker joins the union when she is indifferent about joining.* C 0 3 No 1 4 2 1 14 2 2 3 No 3 5 b. C₁ 2 bz N 1 0 0 3 4621 a. Find the SPNE. (Hint: The answer depends on the value of n). b. Now suppose that payoffs are as follows. For Norma Rae, her payoff from not joining is 0, from joining when at least 2 people join is 1, and

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A Find the SPNE Hint The answer depends on the value of n The SPNE subgame perfect Nash equilibrium of this game is determined by the number of workers n If n is less than or equal to 2 then the SPNE ... View the full answer