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The Union Wage Premium in the US and the UK

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  • David Blanchflower
  • Alex Bryson

Abstract

This paper presents evidence of both counter-cyclical and secular decline in the union membership wage premiu m inthe US and the UK over the last couple of decades. The premium has fallen for most groups of workers, the mainexception being public sector workers in the US. By the beginning of the 21st Century the premium remainedsubstantial in the US but there was no premium for many workers in the UK. Industry, state and occupation-levelanalyses for the US identify upward as well as downward movement in the premium characterized by regression tothe mean. Using linked employer-employee data for Britain we show estimates of the membership premium tend tobe upwardly biased where rich employer data are absent and that OLS estimates are higher than those obtained withpropensity score matching.

Suggested Citation

  • David Blanchflower & Alex Bryson, 2004. "The Union Wage Premium in the US and the UK," CEP Discussion Papers dp0612, Centre for Economic Performance, LSE.
  • Handle: RePEc:cep:cepdps:dp0612
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    Cited by:

    1. Maury Gittleman & Morris M. Kleiner, 2016. "Wage Effects of Unionization and Occupational Licensing Coverage in the United States," ILR Review, Cornell University, ILR School, vol. 69(1), pages 142-172, January.
    2. Barragan, Luis, 2006. "¿Cuánto es el premio al salario por pertenecer a un sindicato en el Ecuador?: Un análisis usando Propensity Score Matching
      [How much it is the prize to the wage to belong to a union in Ecuador?: An
      ," MPRA Paper 3947, University Library of Munich, Germany.
    3. Mathieu Bunel & Gilles Raveaud, 2012. "Union Membership does not pay: Evidence from recent French Micro Data," Economics Working Paper Archive (University of Rennes 1 & University of Caen) 201232, Center for Research in Economics and Management (CREM), University of Rennes 1, University of Caen and CNRS.
    4. Hervé Boulhol & Sabien Dobbelaere & Sara Maioli, 2011. "Imports as Product and Labour Market Discipline," British Journal of Industrial Relations, London School of Economics, vol. 49(2), pages 331-361, June.
    5. Ian Thomas MacDonald, 2014. "Towards Neoliberal Trade Unionism: Decline, Renewal and Transformation in North American Labour Movements," British Journal of Industrial Relations, London School of Economics, vol. 52(4), pages 725-752, December.
    6. Gerry H. Makepeace & Michael J. Peel, 2013. "Combining information from Heckman and matching estimators: testing and controlling for hidden bias," Economics Bulletin, AccessEcon, vol. 33(3), pages 2422-2436.
    7. Mathieu Bunel & Gilles Raveaud, 2011. "Union Membership does not pay," Working Papers halshs-00868217, HAL.
    8. Cedric Dawkins, 2010. "Beyond Wages and Working Conditions: A Conceptualization of Labor Union Social Responsibility," Journal of Business Ethics, Springer, vol. 95(1), pages 129-143, August.
    9. Marco Pinto & Jochen Michaelis, 2014. "International Trade and Unemployment—the Worker-selection Effect," Review of International Economics, Wiley Blackwell, vol. 22(2), pages 226-252, May.
    10. 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 for the Study of Labor (IZA).
    11. 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.
    12. J. Shackleton, 2007. "Britain’s Labor Market Under the Blair Governments," Journal of Labor Research, Springer, vol. 28(3), pages 454-476, July.

    More about this item

    Keywords

    union membership wage premium.;

    JEL classification:

    • J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
    • J52 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Dispute Resolution: Strikes, Arbitration, and Mediation

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