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Union Wage Effects in Australia: Are There Variations in Distribution?

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  • Lixin Cai

    ()
    (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne)

  • Amy Y.C. Liu

    (Crawford School of Economics and Government, Australian National University)

Abstract

Previous research on union wage effects in Australia has focused on the central parts of the conditional wage distribution. This study uses quantile regression models to examine whether the union wage effect varies across the (conditional) wage distribution. The data draw upon the first four waves of the Household, Income and Labour Dynamics in Australia (HILDA) survey. Union wage premiums are found across almost the entire wage distribution for both males and females. While for males it is evident that the union wage effect decreases when moving up the wage distribution, the effect for females is relatively stable except at the extremities of the distribution. Overall, unions are found to have a larger effect on male than on female wages. The decomposition results show that for males, the union wage effect explains a substantial proportion of the observed wage gap between union and non-union workers; this is not the case for females.

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Bibliographic Info

Paper provided by Melbourne Institute of Applied Economic and Social Research, The University of Melbourne in its series Melbourne Institute Working Paper Series with number wp2007n017.

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Length: 40 pages
Date of creation: Jun 2007
Date of revision:
Handle: RePEc:iae:iaewps:wp2007n017

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  14. David G. Blanchflower & Richard B. Freeman, 1990. "Going Different Ways: Unionism in the U.S. and Other Advanced O.E.C.D. Countries," NBER Working Papers 3342, National Bureau of Economic Research, Inc.
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