15-4 Salary Negotiation

The below figure represents the potential outcomes of your first salary negotiation after graduation. Assuming this is a sequential-move game with

the employer moving first, indicate the most likely outcome. Does the ability to move first give the employer an advantage? If so, how? As the

employee, is there anything you could do to realize a higher payoff?

Employer Low Salary Offer High Salary Offer Employee Walks Employee Accepts Employee Walks Employee Accepts Employer gets o Employer gets 100 Employee gets o Employer gets o Employee gets 100 Employee gets 75 Employee gets o Employer gets 75