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Does Membership Pay off for Covered Workers? A Distributional Analysis of the Free Rider Problem

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  • Ozkan Eren

Abstract

This paper examines the union membership wage premium among private sector employees covered by collective bargaining agreements. Using Current Population Survey data for 2000-2003, the author not only estimates the conditional mean wage premium---the metric on which most previous research has focused---but also employs recently developed (instrumental) quantile regression techniques to estimate the wage effect of membership across the wage distribution. Members enjoyed, on average, a wage premium of 9% over comparable covered nonmembers. Further analyses find no evidence that this mean premium is explained either by unobserved differences or by measurement error. The author also finds that a narrow focus on the mean impact partially masks heterogeneity in the impact across the distribution. Notably, membership wage effects were considerably more pronounced for low wage earners than for high wage earners.

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Bibliographic Info

Article provided by ILR Review, Cornell University, ILR School in its journal ILR Review.

Volume (Year): 62 (2009)
Issue (Month): 3 (April)
Pages: 367-380

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Handle: RePEc:ilr:articl:v:62:y:2009:i:3:p:367-380

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Cited by:
  1. Thomas Breda, 2010. "Are union representatives badly paid? Evidence from France," Working Papers halshs-00564905, HAL.
  2. Victor Chernozhukov & Christian Hansen, 2013. "Quantile models with endogeneity," CeMMAP working papers CWP25/13, Centre for Microdata Methods and Practice, Institute for Fiscal Studies.
  3. Goerke, Laszlo & Pannenberg, Markus, 2010. "Trade Union Membership and Dismissals," IZA Discussion Papers 5222, Institute for the Study of Labor (IZA).
  4. Laszlo Goerke & Markus Pannenberg, 2012. "Trade Union Membership and Sickness Absence: Evidence from a Sick Pay Reform," IAAEU Discussion Papers 201207, Institute of Labour Law and Industrial Relations in the European Union (IAAEU).
  5. Thomas Breda, 2010. "Firms' rents, workers' bargaining power and the union wage premium in France," Working Papers halshs-00564903, HAL.
  6. Thomas Breda, 2010. "Firms' rents, workers' bargaining power and the union wage premium in France," PSE Working Papers halshs-00564903, HAL.

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