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Measuring the Effects of Arbitration on Wage Levels: The Case of Police Officers

  • Orley Ashenfelter
  • Dean Hyslop

In this paper we provide an empirical evaluation of the effect that the provision of an arbitration statute has on the wage levels of police officers. We analyze the effect of arbitration on wages by comparing wage levels across political jurisdictions and over time using a sample of states. Two complementary data sources are used: panel data on state level wages of police officers, and individual level data on police officers from Decennial Censuses. The empirical results from both data sets are remarkably consistent and provide no robust evidence that the presence of arbitration statues has a consistent effect on overall wage levels. On average, the effect of arbitration is approximately zero, although there is substantial heterogeneity in the estimated effects across states.

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File URL: http://www.nber.org/papers/w7294.pdf
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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 7294.

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Date of creation: Aug 1999
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Publication status: published as Orley Ashenfelter & Dean Hyslop, 2001. "Measuring the effect of arbitration on wage levels: The case of police officers," Industrial and Labor Relations Review, ILR Review, ILR School, Cornell University, vol. 54(2), pages 316-328, January.
Handle: RePEc:nbr:nberwo:7294
Note: LS
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  1. Henry S. Farber & Harry C. Katz, 1979. "Interest arbitration, outcomes, and the incentive to bargain," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 33(1), pages 55-63, October.
  2. Ichniowski, Casey & Freeman, Richard Barry & Lauer, Harrison, 1989. "Collective Bargaining Laws, Threat Effects, and the Determination of Police Compensation," Scholarly Articles 4631949, Harvard University Department of Economics.
  3. Freeman, Richard B, 1986. "Unionism Comes to the Public Sector," Journal of Economic Literature, American Economic Association, vol. 24(1), pages 41-86, March.
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