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Everyone's A Winner? Union Effects on Persistence in Private Sector Wage Settlements: Longitudinal Evidence from Britain

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Author Info
Donna Brown (Royal Holloway College, University of London)
Peter Ingram (University of Surrey)
Jonathan Wadsworth (CEPR and Royal Holloway College, University of London)

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Abstract

Against a background of increased decentralisation in the structure of wage decision making, we analyse the effects of unions on the dispersion and persistence of pay settlements over the medium term using a longitudinal data set covering British private sector establishments over the period 1987-2001. It seems that the union effect of a reduction in wage dispersion in pay levels observed in earlier studies is repeated when we follow wage changes (settlements) over the medium term. Declining union presence seems therefore to account for some of the increase in longer-term wage dispersion over the sample period. The increase in aggregate wage settlement dispersion seems to have been accompanied by an increase in the permanent rather than transitory components of the variance and this stems mostly from the non-union sector.

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Publisher Info
Paper provided by Department of Economics, University of Surrey in its series Department of Economics Discussion Papers with number 1104.

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Length: 40 pages
Date of creation: Oct 2004
Date of revision:
Handle: RePEc:sur:surrec:1104

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Related research
Keywords: Pay; Wage Change; Unions; Persistence; Inequality;

Find related papers by JEL classification:
J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
J5 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining
J6 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Bell, Brian D & Pitt, Michael K, 1998. "Trade Union Decline and the Distribution of Wages in the UK: Evidence from Kernel Density Estimation," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 60(4), pages 509-28, November.
  2. Andrews, Martyn J & Bell, David N F & Upward, Richard, 1998. "Union Coverage Differentials. Some Estimates for Britain Using the New Earnings Survey Panel Dataset," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 60(1), pages 47-77, February.
  3. Peter Gottschalk & Robert Moffitt, 1994. "The Growth of Earnings Instability in the U.S. Labor Market," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 25(1994-2), pages 217-272. [Downloadable!]
  4. David Card, 1992. "The Effect of Unions on the Distribution of Wages: Redistribution or Relabelling?," NBER Working Papers 4195, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  5. Robert C. Marshall & Antonio Merlo, 2004. "Pattern Bargaining," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 45(1), pages 239-255, 02. [Downloadable!] (restricted)
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  6. Baker, Michael, 1997. "Growth-Rate Heterogeneity and the Covariance Structure of Life-Cycle Earnings," Journal of Labor Economics, University of Chicago Press, vol. 15(2), pages 338-75, April. [Downloadable!] (restricted)
  7. John W. Budd, 1992. "The determinants and extent of UAW pattern bargaining," Industrial and Labor Relations Review, ILR Review, ILR School, Cornell University, vol. 45(3), pages 523-539, April.
  8. Blau, Francine D. & Kahn, Lawrence M., 1999. "Institutions and laws in the labor market," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 25, pages 1399-1461 Elsevier. [Downloadable!] (restricted)
  9. 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!]
  10. Layard, R. & Nickell, S., . "Layard-Nickell," Instructional Stata datasets for econometrics layardnickell, Boston College Department of Economics. [Downloadable!]
  11. Lemieux, Thomas, 1998. "Estimating the Effects of Unions on Wage Inequality in a Panel Data Model with Comparative Advantage and Nonrandom Selection," Journal of Labor Economics, University of Chicago Press, vol. 16(2), pages 261-91, April. [Downloadable!] (restricted)
  12. Atkinson, A. B. & Bourguignon, F. & Morrisson, C., 1988. "Earnings mobility," European Economic Review, Elsevier, vol. 32(2-3), pages 619-632, March. [Downloadable!] (restricted)
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This page was last updated on 2009-11-27.

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