Now assume that the worker, through their union workplace agreement has a veto right on any

incentive scheme, and there is no incentive scheme currently in place. If the worker agrees to have

an incentive scheme the game outline above is played. If the worker does not agree, the subgame

following NI is played $($that is no incentive scheme can be implemented$).$ The boss and the worker

can negotiate to allow for incentive scheme to be legally implemented $($and compensation$/$side

payments can be made as part of this agreement$).$ If the worker has all of the bargaining power

during these negotiations, what will happen? Is the outcome surplus$‐$maximising$?$ Explain your

answer in the context of the value$‐$maximisation principle?