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Unionization and the Evolution of the Wage Distribution in Sweden: 1968 to 2000

Author

Listed:
  • Albrecht, James

    (Georgetown University)

  • Björklund, Anders

    (SOFI, Stockholm University)

  • Vroman, Susan

    (Georgetown University)

Abstract

We examine the evolution of the Swedish wage distribution over the periods 1968-1981 and 1981-2000. The first period was the heyday of the Swedish solidarity wage policy with strongly equalization clauses in the central wage agreements. During the second period, there was more scope for firm-specific factors to affect wages. We find a remarkable compression of wages across the distribution in the first period, but in the second period, wage growth was quite uniform across the distribution. We decompose these changes across the distribution into two components – those due to changes in the distribution of characteristics such as education and experience and those due to changes in the distribution of returns to those characteristics. The wage compression between 1968 and 1981 was driven by changes in the distribution of returns, but between 1981 and 2000, the change in the distribution of returns was neutral with respect to inequality.

Suggested Citation

  • Albrecht, James & Björklund, Anders & Vroman, Susan, 2009. "Unionization and the Evolution of the Wage Distribution in Sweden: 1968 to 2000," IZA Discussion Papers 4246, Institute of Labor Economics (IZA).
  • Handle: RePEc:iza:izadps:dp4246
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    References listed on IDEAS

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    Cited by:

    1. Rebekka Christopoulou & Theodora Kosma, 2009. "Skills and Wage Inequality in Greece: Evidence from Matched Employer-Employee Data, 1995-2002," GreeSE – Hellenic Observatory Papers on Greece and Southeast Europe 26, Hellenic Observatory, LSE.
    2. Buendía, Luis & Barredo, Juan & Balay, Juan, 2022. "Foreign sector and welfare state in Sweden: From complementarity to tensions," Structural Change and Economic Dynamics, Elsevier, vol. 63(C), pages 310-319.
    3. Carrasco, Raquel & Jimeno, Juan F. & Ortega, Ana Carolina, 2012. "Declining returns to skill and the distribution of wages : Spain 1995-2006," UC3M Working papers. Economics we1231, Universidad Carlos III de Madrid. Departamento de Economía.

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    More about this item

    Keywords

    quantile regression; wage compression; unionization;
    All these keywords.

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects

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