1. How could union members’ current annual incomes decline on net even if a long-lived strike induces a firm’s management to increase the hourly wage rate? 2. Sometimes union memberships coordinate work stoppages when all workers call in sick. From an economic standpoint, is there any difference between coordinated sick day work stoppages and strikes? Explain. Solution (1) This seems paradoxical, but even though hourly wages increase, a long strike will reduce the participant union members\' annual incomes. This is because, the annual income is a function of hourly wage - how many hours in the year a worker has worked. With an increased wage rate, the corresponding demand for labor will decrease (since, output will not increase due to the strike). As labor demand decrease, management will eventually cut down on workforce, thus quite a few workers will lose their job. Secondly, due to the strike, number of hours worked will also decline, and total income (wage mulplied by hours worked) will reduce as well. The total annual income of union members will therefore decline. (2) There is two differences between mass-scale sick day work stoppage & strikes. One, Federal labor law does not allow a strike unless there is a 60-day wait period, which the union must allow before the management refuses to agree to their terms & conditions. With a mass-scale sick day stoppage, this stipulation is not applicable. Two, even if all workers take sick leave, management is bound to pay them the wage even when productivity falls down to zero. But in case of a strike, the workers do not legally have a claim to get paid..