Union Wage Effects in Australia: Evidence from Panel Data
AbstractUsing data from the Household, Income and Labour Dynamics in Australia (HILDA) Survey, our research indicates that unobserved heterogeneity substantially biases cross-sectional estimates of union wage effects upward for both males and females. Estimates of the union wage premium for male workers between the ages of 25 and 64 fall from 8.7 percent to 5.2 percent after controlling for unobserved heterogeneity. For females aged 25 to 63 the estimated 4.0 percent cross-sectional union wage premium falls to 1.9 once unobserved heterogeneity is controlled for. Our results also indicate positive sorting by unobserved skills into union membership, especially among low skilled male and female workers. There is also evidence of negative sorting into unions among the most highly skilled.
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Bibliographic InfoPaper provided by Centre for Economic Policy Research, Research School of Economics, Australian National University in its series CEPR Discussion Papers with number 585.
Date of creation: Aug 2008
Date of revision:
union wage effects; fixed effects models; panel data;
Other versions of this item:
- Lixin Cai & C. Jeffrey Waddoups, 2011. "Union Wage Effects in Australia: Evidence from Panel Data," British Journal of Industrial Relations, London School of Economics, vol. 49(Supplemen), pages s279-s305, 07.
- Lixin Cai & C. Jeffrey Waddoups, 2009. "Union Wage Effects in Australia: Evidence from Panel Data," Working Papers 0914, University of Nevada, Las Vegas , Department of Economics.
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
- J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-09-05 (All new papers)
- NEP-BEC-2008-09-05 (Business Economics)
- NEP-LAB-2008-09-05 (Labour Economics)
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