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The Union Membership Wage Premium for Employees Covered by Collective Bargaining Agreements

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Author Info
Budd, John W
Na, In-Gang

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Abstract

Using Current Population Survey data for 1983-93, this article analyzes whether there is a union membership wage premium among full-time, private sector employees covered by union contracts. Ordinary least squares estimates of the membership wage premium are 12%-14%, and allowing membership to be endogenous yields larger estimates. Differences in job tenure, unobservable characteristics, and measurement error cannot fully explain the estimated premium. Significant differences in this premium, as well as in membership rates conditional upon coverage, across various demographic subgroups are also documented. In general, "free riders" do not appear to be free riding. Copyright 2000 by University of Chicago Press.

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Publisher Info
Article provided by University of Chicago Press in its journal Journal of Labor Economics.

Volume (Year): 18 (2000)
Issue (Month): 4 (October)
Pages: 783-807
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Handle: RePEc:ucp:jlabec:v:18:y:2000:i:4:p:783-807

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  1. Booth, Alison L & Bryan, Mark L, 2001. "The Union Membership Wage Premium Puzzle: Is There A Free-Rider Problem?," CEPR Discussion Papers 2879, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
    Other versions:
  2. Johansson, Robert C. & Coggins, Jay S. & Senauer, Ben H., 1999. "Union Density Effects In The Supermarket Industry," Working Papers 14313, University of Minnesota, The Food Industry Center. [Downloadable!]
    Other versions:
  3. repec:ese:iserwp: is not listed on IDEAS
  4. John W. Budd & Karen Mumford, . "Trade Unions and Family Friendly Policies in Britain," Working Papers 0302, Industrial Relations Center, University of Minnesota (Twin Cities Campus). [Downloadable!]
    Other versions:
  5. David Card & Thomas Lemieux & W. Craig Riddell, 2003. "Unionization and Wage Inequality: A Comparative Study of the U.S, the U.K., and Canada," NBER Working Papers 9473, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  6. Edward J. Schumacher, . "What Explains Union Membership Contract Coverage Wage Differentials?," Working Papers 9719, East Carolina University, Department of Economics. [Downloadable!]
  7. Miriam Abu Sharkh, 2008. "Are there optimal global configurations of labour market flexibility and security? : Tackling the "flexicurity" oxymoron," Employment Working Papers 2008-15, International Labour Office. [Downloadable!]
  8. Stephan, Gesine & Gerlach, Knut, 2004. "Collective contracts, wages and wage dispersion in a multi-level model," IAB Discussion Paper 200406, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]. [Downloadable!]
  9. Manquilef-Bächler, Alejandra A. & Arulampalam, Wiji & Smith, Jennifer C., 2009. "Differences in Decline: Quantile Regression Analysis of Union Wage Differentials in the United Kingdom, 1991-2003," IZA Discussion Papers 4138, Institute for the Study of Labor (IZA). [Downloadable!]
  10. Jaime Saavedra-Chanduví & Máximo Torero, 2002. "Union Density Changes and Union Effects On Firm Performance in Peru," RES Working Papers 3158, Inter-American Development Bank, Research Department. [Downloadable!]
  11. David Blanchflower & Alex Bryson, 2004. "The Union Wage Premium in the US and the UK," CEP Discussion Papers dp0612, Centre for Economic Performance, LSE. [Downloadable!]
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