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Training and Union Wages

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  • Christian Dustmann

    (Department of Economics, University College London)

  • Uta Schönberg

    (Department of Economics, University College London and Institute for Employment Research (IAB), Nuremberg)

Abstract

This paper investigates whether unions, through imposing wage floors that lead to wage compression, increase on-the-job training. Our analysis focuses on Germany. Based on a model of unions and firm-financed training, we derive empirical implications regarding apprenticeship training intensity, layoffs, wage cuts, and wage compression in unionized and nonunionized firms. We test these implications using firm panel data matched with administrative employee data. We find support for the hypothesis that union recognition, via imposing minimum wages and wage compression, increases training in apprenticeship programs. Copyright by the President and Fellows of Harvard College and the Massachusetts Institute of Technology.

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Bibliographic Info

Article provided by MIT Press in its journal The Review of Economics and Statistics.

Volume (Year): 91 (2009)
Issue (Month): 2 (May)
Pages: 363-376

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Handle: RePEc:tpr:restat:v:91:y:2009:i:2:p:363-376

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  1. Arulampalam, Wiji & Alison L Booth & Mark L Bryan, 2003. "Work-related Training and the New National Minimum Wage in Britain," Royal Economic Society Annual Conference 2003, Royal Economic Society 9, Royal Economic Society.
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  15. Joseph G. Altonji & James R. Spletzer, 1991. "Worker characteristics, job characteristics, and the receipt of on-the-job training," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, ILR Review, Cornell University, ILR School, vol. 45(1), pages 58-79, October.
  16. David Neumark & William Wascher, 1998. "Minimum Wages and Training Revisited," NBER Working Papers 6651, National Bureau of Economic Research, Inc.
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