IDEAS home Printed from https://ideas.repec.org/p/unu/wpaper/wp-2018-71.html
   My bibliography  Save this paper

Does union membership pay off?: Evidence from Vietnamese SMEs

Author

Abstract

In the absence of adequate institutional mechanisms, trade unions can potentially promote higher wages and other worker benefits, yet limited data availability means little is known about the effect unions have on individual earnings in developing economies. Using matched employer-employee data from 2013 and 2015 surveys, this paper examines the union wage premium among Vietnamese small and medium-sized enterprises. Controlling for firm and worker characteristics, the results show that unionized workers' wages are 9-22 per cent higher than those of non-union workers.

Suggested Citation

  • Nina Torm, 2018. "Does union membership pay off?: Evidence from Vietnamese SMEs," WIDER Working Paper Series wp-2018-71, World Institute for Development Economic Research (UNU-WIDER).
    • Handle: RePEc:unu:wpaper:wp-2018-71
    as

    Download full text from publisher

    File URL: https://www.wider.unu.edu/sites/default/files/Publications/Working-paper/PDF/wp2018-71.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Sims,Christopher A. (ed.), 1994. "Advances in Econometrics," Cambridge Books, Cambridge University Press, number 9780521444606.
    2. Jones, Patricia, 2001. "Are educated workers really more productive?," Journal of Development Economics, Elsevier, vol. 64(1), pages 57-79, February.
    3. Benedikte Bjerge & Nina Torm & Neda Trifkovic, 2016. "Gender matters: Private sector training in Vietnamese SMEs," WIDER Working Paper Series 149, World Institute for Development Economic Research (UNU-WIDER).
    4. Abadie, Alberto & Imbens, Guido W., 2011. "Bias-Corrected Matching Estimators for Average Treatment Effects," Journal of Business & Economic Statistics, American Statistical Association, vol. 29(1), pages 1-11.
    5. Jacob A. Mincer, 1974. "Schooling, Experience, and Earnings," NBER Books, National Bureau of Economic Research, Inc, number minc74-1, March.
    6. repec:eee:labchp:v:2:y:1986:i:c:p:1139-1181 is not listed on IDEAS
    7. Ying Zhu & Stephanie Fahey, 2000. "The challenges and opportunities for the trade union movement in the transition era: two socialist market economies -- China and Vietnam," Asia Pacific Business Review, Taylor & Francis Journals, vol. 6(3-4), pages 282-299, January.
    8. Booth, Alison L & Chatterji, Monojit, 1995. "Union Membership and Wage Bargaining When Membership is Not Compulsory," Economic Journal, Royal Economic Society, vol. 105(429), pages 345-360, March.
    9. Sims,Christopher A. (ed.), 1994. "Advances in Econometrics," Cambridge Books, Cambridge University Press, number 9780521444590.
    10. M Rama, 2000. "Wage misalignment in CFA countries: were labour market policies to blame?," Journal of African Economies, Centre for the Study of African Economies, vol. 9(4), pages 475-511.
    11. John Pencavel, 2005. "Unionism Viewed Internationally," Journal of Labor Research, Transaction Publishers, vol. 26(1), pages 65-97, January.
    12. Nina Torm, 2014. "The Role Of Trade Unions In Vietnam: A Case Study Of Small And Medium Enterprises," Journal of International Development, John Wiley & Sons, Ltd., vol. 26(2), pages 207-221, March.
    13. Nguyen, Binh T. & Albrecht, James W. & Vroman, Susan B. & Westbrook, M. Daniel, 2007. "A quantile regression decomposition of urban-rural inequality in Vietnam," Journal of Development Economics, Elsevier, vol. 83(2), pages 466-490, July.
    14. Anna Folke Larsen & John Rand & Nina Torm, 2011. "Do Recruitment Ties Affect Wages? An Analysis using Matched Employer–Employee Data from Vietnam," Review of Development Economics, Wiley Blackwell, vol. 15(3), pages 541-555, August.
    15. Jacob A. Mincer, 1974. "Schooling and Earnings," NBER Chapters, in: Schooling, Experience, and Earnings, pages 41-63, National Bureau of Economic Research, Inc.
    16. Fields, Gary S & Yoo, Gyeongjoon, 2000. "Falling Labor Income Inequality in Korea's Economic Growth: Patterns and Underlying Causes," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 46(2), pages 139-159, June.
    17. 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 of Labor Economics (IZA).
    18. John Rand & Finn Tarp, 2011. "Does Gender Influence the Provision of Fringe Benefits? Evidence From Vietnamese SMEs," Feminist Economics, Taylor & Francis Journals, vol. 17(1), pages 59-87, January.
    19. Rachel Croson & Uri Gneezy, 2009. "Gender Differences in Preferences," Journal of Economic Literature, American Economic Association, vol. 47(2), pages 448-474, June.
    20. repec:adr:anecst:y:1996:i:41-42:p:07 is not listed on IDEAS
    21. repec:eee:labchp:v:3:y:1999:i:pb:p:2629-2710 is not listed on IDEAS
    22. Abowd, John M. & Kramarz, Francis, 1999. "The analysis of labor markets using matched employer-employee data," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 40, pages 2629-2710, Elsevier.
    23. Robert J. Lalonde & Gérard Marschke & Kenneth Troske, 1996. "Using Longitudinal Data on Establishments to Analyze the Effects of Union Organizing Campaigns in the United States," Annals of Economics and Statistics, GENES, issue 41-42, pages 155-185.
    24. Toke Aidt & Zafiris Tzannatos, 2002. "Unions and Collective Bargaining : Economic Effects in a Global Environment," World Bank Publications - Books, The World Bank Group, number 15241, December.
    25. Soderbom, Mans & Teal, Francis & Wambugu, Anthony, 2005. "Unobserved heterogeneity and the relation between earnings and firm size: evidence from two developing countries," Economics Letters, Elsevier, vol. 87(2), pages 153-159, May.
    26. Gary S. Fields & Gyeongjoon Yoo, 2000. "Falling Labor Income Inequality In Korea'S Economic Growth: Patterns And Underlying Causes," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 46(2), pages 139-159, June.
    27. Alberto Abadie & Guido W. Imbens, 2006. "Large Sample Properties of Matching Estimators for Average Treatment Effects," Econometrica, Econometric Society, vol. 74(1), pages 235-267, January.
    28. Michael Spence, 1973. "Job Market Signaling," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 87(3), pages 355-374.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Sung Min Han & Fangjin Ye, 2022. "Labor union, between group inequality, and individual attitudes toward redistribution," Social Science Quarterly, Southwestern Social Science Association, vol. 103(5), pages 1248-1259, September.
    2. Linh Thuy Pham & Yothin Jinjarak, 2023. "Global value chains and female employment: The evidence from Vietnam," The World Economy, Wiley Blackwell, vol. 46(3), pages 726-757, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Nina Torm, 2018. "Does union membership pay off?: Evidence from Vietnamese SMEs," WIDER Working Paper Series 71, World Institute for Development Economic Research (UNU-WIDER).
    2. Benedikte Bjerge & Nina Torm & Neda Trifkovic, 2016. "Gender matters: Private sector training in Vietnamese SMEs," WIDER Working Paper Series 149, World Institute for Development Economic Research (UNU-WIDER).
    3. Trifković, Neda, 2017. "Spillover Effects of International Standards: Working Conditions in the Vietnamese SMEs," World Development, Elsevier, vol. 97(C), pages 79-101.
    4. Neda Trifković, 2015. "Spillover Effects of International Standards: Work Conditions in Vietnamese Small and Medium Enterprises," WIDER Working Paper Series wp-2015-047, World Institute for Development Economic Research (UNU-WIDER).
    5. Neda Trifkovic, 2015. "Spillover effects of international standards: Work conditions in Vietnamese small and medium enterprises," WIDER Working Paper Series 047, World Institute for Development Economic Research (UNU-WIDER).
    6. Benedikte Bjerge & Nina Torm & Neda Trifković, 2016. "Gender matters: Private sector training in Vietnamese SMEs," WIDER Working Paper Series wp-2016-149, World Institute for Development Economic Research (UNU-WIDER).
    7. Beatriz Muriel Hernández, 2016. "An Analysis of Firm Characteristics as Earnings Determinants: The Urban Bolivia Case," Development Research Working Paper Series 04/2016, Institute for Advanced Development Studies.
    8. Wu, Na & Wang, Qunyong, 2018. "Wage penalty of overeducation: New micro-evidence from China," China Economic Review, Elsevier, vol. 50(C), pages 206-217.
    9. Beatriz Muriel, 2011. "Rethinking Earnings Determinants in the Urban Areas of Bolivia," Development Research Working Paper Series 06/2011, Institute for Advanced Development Studies.
    10. Philip Trostel & Ian Walker, 2006. "Education and Work," Education Economics, Taylor & Francis Journals, vol. 14(4), pages 377-399.
    11. Schlueter, Tobias & Sievers, Soenke & Hartmann-Wendels, Thomas, 2015. "Bank funding stability, pricing strategies and the guidance of depositors," Journal of Banking & Finance, Elsevier, vol. 51(C), pages 43-61.
    12. Catalina Amuedo-Dorantes, 2005. "Work Contracts and Earnings Inequality: The Case of Chile," Journal of Development Studies, Taylor & Francis Journals, vol. 41(4), pages 589-616.
    13. Massimo Del Gatto & Adriana Di Liberto & Carmelo Petraglia, 2011. "Measuring Productivity," Journal of Economic Surveys, Wiley Blackwell, vol. 25(5), pages 952-1008, December.
    14. Casey B. Mulligan, 1999. "Substitution over Time: Another Look at Life-Cycle Labor Supply," NBER Chapters, in: NBER Macroeconomics Annual 1998, volume 13, pages 75-152, National Bureau of Economic Research, Inc.
    15. Qingjie Xia & Lina Song & Shi Li & Simon Appleton, 2014. "The effect of the state sector on wage inequality in urban China: 1988--2007," Journal of Chinese Economic and Business Studies, Taylor & Francis Journals, vol. 12(1), pages 29-45, February.
    16. Huong Vu & Steven Lim & Mark Holmes & Tinh Doan, 2013. "Firm Exporting and Employee Benefits: First Evidence from Vietnam Manufacturing SMEs," Economics Bulletin, AccessEcon, vol. 33(1), pages 519-535.
    17. Rupert, Peter & Zanella, Giulio, 2015. "Revisiting wage, earnings, and hours profiles," Journal of Monetary Economics, Elsevier, vol. 72(C), pages 114-130.
    18. Sungwon Lee, 2021. "Partial Identification and Inference for Conditional Distributions of Treatment Effects," Papers 2108.00723, arXiv.org, revised Nov 2023.
    19. Rand, John & Torm, Nina, 2012. "The Benefits of Formalization: Evidence from Vietnamese Manufacturing SMEs," World Development, Elsevier, vol. 40(5), pages 983-998.
    20. T. Paul Schultz & Germano Mwabu, 1998. "Labor Unions and the Distribution of Wages and Employment in South Africa," ILR Review, Cornell University, ILR School, vol. 51(4), pages 680-703, July.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:unu:wpaper:wp-2018-71. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Siméon Rapin (email available below). General contact details of provider: https://edirc.repec.org/data/widerfi.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.