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Does a Specific Union Impact on Wage Increases? Evidence from Canada, 1985-2007

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  • Edison Roy César
  • François Vaillancourt

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    Abstract

    The purpose of this note is to examine the effect of belonging to a specific union on negotiated wage increases, given unionisation status. The data consist of all collective agreements with more than 500 employees, which were signed in Quebec (N=632) or Ontario (N=1349) during the 1985-2007 period. The model used is a standard wage equation with the negotiated rate of increase of base wages, annualized as the dependent variable and four dichotomous variables for a specific union, the CPI and the unemployment rate two quarters before the collective agreements, the presence or not of a cost of living agreements in the collective agreement and eighteen industrial dichotomous variables. We find with one exception no evidence that one union is better than another in obtaining higher wage growth. L’objectif de ce cahier est d’examiner l’impact d’une affiliation syndicale spécifique sur l’augmentation des salaires négociés, étant donné la syndicalisation. Les données sont l’ensemble des conventions collectives de 500 employés et plus qui ont été signées au Québec (N=632) et en Ontario (N=1349) durant la période 1985-2007. Le modèle utilisé est une équation salariale typique avec le taux d’augmentation salariale annualisé comme variable dépendante et quatre variables dichotomiques pour les syndicats spécifiques, l’IPC et le taux de chômage retardée de deux périodes par rapport à la signature, la présence ou non d'une clause d’ajustement au coût de la vie et 18 variables de secteur industriel. Nous ne trouvons sauf pour une exception aucun résultat indiquant qu’un syndicat obtient des augmentations plus élevées qu’un autre.

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    Paper provided by CIRANO in its series CIRANO Working Papers with number 2010s-09.

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    Date of creation: 01 Feb 2010
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    Handle: RePEc:cir:cirwor:2010s-09

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    Keywords: Unions wages collective agreements; salaires syndicats; conventions collectives;

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    1. Morley Gunderson & John Kervin & Frank Reid, 1989. "The Effect of Labour Relations Legislation on Strike Incidence," Canadian Journal of Economics, Canadian Economics Association, vol. 22(4), pages 779-94, November.
    2. Vaillancourt, Francois & Marceau, Nicolas, 1990. "Do general and firm-specific employer payroll taxes have the same incidence? : Theory and evidence," Economics Letters, Elsevier, vol. 34(2), pages 175-181, October.
    3. John Schmitt, 2008. "The Union Wage Advantage for Low-Wage Workers," CEPR Reports and Issue Briefs 2008-17, Center for Economic and Policy Research (CEPR).
    4. William E. Even & David A. Macpherson, 2012. "Is Bigger Still Better? The Decline of the Wage Premium at Large Firms," Southern Economic Journal, Southern Economic Association, vol. 78(4), pages 1181-1201, April.
    5. Budd, John W & Na, In-Gang, 2000. "The Union Membership Wage Premium for Employees Covered by Collective Bargaining Agreements," Journal of Labor Economics, University of Chicago Press, vol. 18(4), pages 783-807, October.
    6. Gunderson, Morley & Melino, Angelo, 1990. "The Effects of Public Policy on Strike Duration," Journal of Labor Economics, University of Chicago Press, vol. 8(3), pages 295-316, July.
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