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Trade Union Decline and the Distribution of Wages in the UK: Evidence from Kernel Density Estimation

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  • Bell, Brian D
  • Pitt, Michael K

Abstract

This paper assesses the impact of changes in union density on the male structure in the United Kingdom over the 1980s. Using four separate data sets, the authors estimate the kernel density of hourly wages for men. Counterfactual densities are then generated to predict how the distribution of wages has changed over time because of the decline in union membership. They find that approximately 20 percent of the increase in the variance of log wages over the period can be attributed to changes in unionization. The effect is particularly strong in the latter part of the period. The authors also present disaggregated estimates of the impact of declining unionization. Their results are robust across all the data sets the authors examine and similar results are obtained if union coverage is used rather than union membership. Copyright 1998 by Blackwell Publishing Ltd

Suggested Citation

  • 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 509-528, November.
  • Handle: RePEc:bla:obuest:v:60:y:1998:i:4:p:509-28
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    Cited by:

    1. Checchi, Daniele & Visser, Jelle & van de Werfhorst, Herman G., 2007. "Inequality and Union Membership: The Impact of Relative Earnings Position and Inequality Attitudes," IZA Discussion Papers 2691, Institute for the Study of Labor (IZA).
    2. Fei Peng & Lili Kang, 2013. "Labor Market Institutions and Skill Premiums: An Empirical Analysis on the UK, 1972-2002," Journal of Economic Issues, Taylor & Francis Journals, vol. 47(4), pages 959-982.
    3. repec:eme:rleczz:s0147-9121(06)26009-6 is not listed on IDEAS
    4. John T. Addison & Ralph W. Bailey & W. Stanley Siebert, 2009. "Wage Dispersion in a Partially Unionized Labor Force," GEMF Working Papers 2009-09, GEMF, Faculty of Economics, University of Coimbra.
    5. Cai, Lixin & Liu, Amy Y.C., 2015. "Wage determination and distribution in urban China and Vietnam: A comparative analysis," Journal of Comparative Economics, Elsevier, vol. 43(1), pages 186-203.
    6. Walsh, Frank & Strobl, Eric, 2009. "Recent Trends in Trade Union Membership in Ireland," The Economic and Social Review, Economic and Social Studies, vol. 40(1), pages 117-138.
    7. David Johnston & Wang-Sheng Lee, 2011. "Explaining the Female Black-White Obesity Gap: A Decomposition Analysis of Proximal Causes," Demography, Springer;Population Association of America (PAA), vol. 48(4), pages 1429-1450, November.
    8. Dinardo, John & Hallock, Kevin F & Pischke, Jörn-Steffen, 2000. "Unions And The Labour Market For Managers," CEPR Discussion Papers 2418, C.E.P.R. Discussion Papers.
    9. Pannenberg, Markus & Wagner, Gert G., 2001. "Why Do Overtime Work, Overtime Compensation and the Distribution of Economic Well-Being Evidence for the West Germany and Great Britain," IZA Discussion Papers 318, Institute for the Study of Labor (IZA).
    10. John DiNardo & Kevin Hallock & Jorn-Steffen Pischke, 1997. "Unions and Managerial Pay," NBER Working Papers 6318, National Bureau of Economic Research, Inc.
    11. Töngür, Ünal & Elveren, Adem Yavuz, 2014. "Deunionization and pay inequality in OECD Countries: A panel Granger causality approach," Economic Modelling, Elsevier, vol. 38(C), pages 417-425.
    12. John T. Addison & Ralph W. Bailey & W. Stanley Siebert, 2007. "The Impact of Deunionisation on Earnings Dispersion Revisited," Research in Labor Economics,in: Aspects of Worker Well-Being, volume 26, pages 337-363 Emerald Publishing Ltd.
    13. Sell, Friedrich L. & Öllinger, Michael, 2017. "Reward effects and incentive effects on the labor market: Empirical evidence for European countries," Working Papers in Economics 2017,2, Bundeswehr University Munich, Economic Research Group.
    14. Donna Brown & Peter Ingram & Jonathan Wadsworth, 2004. "Everyone's A Winner? Union Effects on Persistence in Private Sector Wage Settlements: Longitudinal Evidence from Britain," School of Economics Discussion Papers 1104, School of Economics, University of Surrey.
    15. Kharoufeh, Jeffrey P. & Goulias, Konstadinos G., 2002. "Nonparametric identification of daily activity durations using kernel density estimators," Transportation Research Part B: Methodological, Elsevier, vol. 36(1), pages 59-82, January.
    16. repec:bap:journl:170402 is not listed on IDEAS
    17. Richard B. Freeman, 2000. "Single Peaked Vs. Diversified Capitalism: The Relation Between Economic Institutions and Outcomes," NBER Working Papers 7556, National Bureau of Economic Research, Inc.
    18. Susan Hayter, 2015. "Unions and collective bargaining," Chapters,in: Labour Markets, Institutions and Inequality, chapter 4, pages 95-122 Edward Elgar Publishing.
    19. A Charlwood & K Hansen & David Metcalf, 2000. "Unions and the Sword of Justice: Unions and Pay Systems, Pay Inequality, Pay Discrimination and Low Pay," CEP Discussion Papers dp0452, Centre for Economic Performance, LSE.
    20. Gosling, Amanda, 2003. "The Changing Distribution of Male and Female Wages, 1978-2000: Can the Simple Skills Story be Rejected?," CEPR Discussion Papers 4045, C.E.P.R. Discussion Papers.
    21. Metcalf, David & Hansen, Kirstine & Charlwood, Andy, 2000. "Unions and the sword of justice: unions and pay systems, pay inequality, pay discrimination and low pay," LSE Research Online Documents on Economics 20195, London School of Economics and Political Science, LSE Library.

    More about this item

    JEL classification:

    • J50 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - General
    • J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
    • C30 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - General
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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