Spillover, standardization and stratification: earnings determination in the United States and Norway

Colbjørnsen, Tom; Kalleberg, Arne L.

doi:10.1093/oxfordjournals.esr.a036460

“…the estimate 0.005 with a t value of 0.303. In contrast, both Blanch£ower (1996) and ColbjÖrnsen and Kalleberg (1988) have found a signi¢cant individual membership pay premium, using Norwegian individual-level data for 1989^93 and 1982, respectively. One might hypothesize that these results di¡er because previous studies looked at (grouped) earnings data rather than the hourly wage, or because the surveys di¡er with respect to information about personal characteristics.…”

Section: ä Do Workplace Characteristics Explain Why Union Membersmentioning

confidence: 87%

Union Wage Effects: Does Membership Matter?

Barth¹,

Raaum²,

Naylor

³

2000

The Manchester School

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Using a matched employer^employee data set for Norway, we exploit rare information on the union status of both individual employees and their workplaces. We establish two key results. First, we ¢nd a positive e¡ect of workplace trade union density on the level of the individual's pay in establishments covered by collective agreements. Second, we ¢nd that, conditioning on coverage, the individual union membership di¡erential disappears after controlling for establishment-level union density. The union wage e¡ect is therefore a pure public good, with individual membership conveying a positive wage externality. " IntroductionIn this paper, we exploit a matched employee^employer data set for Norway to analyse the e¡ects of trade unions on wages in establishments covered by collective agreements. Our main focus is on whether the level of trade union density at the workplace a¡ects the individual's level of pay. We also address the question of how the inclusion of information on establishment-level union density a¡ects the estimate of any individual union membership wage di¡erential in the covered sector. 1 This acts as a test of the hypothesis that estimated union membership di¡erentials might arise, at least in part, from omitted establishment-level variables which are correlated with individual membership, such as establishment-level density.We present a theoretical model in which plant-level union density has a direct in£uence on the bargained wage, through its impact on the capacity of workers to in£ict loss on the ¢rm during industrial action. We then conduct an empirical analysis of the relationship between wages and

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“…The first is a "spillover effect", where higher union wages compel unionized employers to cut their levels of employment, hence creating higher levels of unemployment and downward pressure on non-union wages (Lewis, 1963;1990;Farber, 2005). Colbjornsen and Kalleberg (1988) conducted research in the Scandinavian countries, which are characterized by high levels of unionization (Neumann et al, 1991) but, at the same time, the economic advantage of belonging to a union seems to be particularly small (Le Grand, 1989). In their study, they explained this by occurrence of substantial spillover effects.…”

Section: Introduction To the Chaptermentioning

confidence: 99%

Regression Results of the Union Impact on Pay Levels in New Zealand Public Service

Feinberg-Danieli¹

0

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<p>International studies almost uniformly conclude that union members receive higher wages than their non-union counterparts. This study investigates differences between collective and individual salaries using the New Zealand State Services Commission's Human Resources Capability Survey 2005. It explores the impact of collective bargaining on pay by controlling for a large number of employee and employer characteristics. As very little research has been carried out on the subject in New Zealand, I focused on the international literature in order to identify the major factors that explain the magnitude of union/non-union wage differential. Major industrial changes, which have shaped the NZ public service bargaining structure and its outcomes are identified. A range of statistical tests are used to examine the pay differences between collective and individual agreements in New Zealand public service. I, first, carry out basic comparisons of the average collective and individual wages across gender, employment type, occupations, ethnicity, age, employer size and tenure, followed by numerous multivariate regressions to work out the true contributing factors to the union/non-union wage differential. Finally, I analyze the results in the unique NZ context to allow new ideas and theory to emerge and compare it to international trends. Looking at the basic comparisons, I found that, in the New Zealand public service, employees on individual agreements earn significantly higher wages then those who are covered by collective agreements. However, multivariate analyses have revealed a different picture. The study found that occupational composition is the largest contributor to the variability in collective/individual pay in NZPS. With the exception of the senior, high skilled and specialised employees, no pay differential was found between collective or individual agreements in the New Zealand public service.</p>

show abstract

“…The first is a "spillover effect", where higher union wages compel unionized employers to cut their levels of employment, hence creating higher levels of unemployment and downward pressure on non-union wages (Lewis, 1963;1990;Farber, 2005). Colbjornsen and Kalleberg (1988) conducted research in the Scandinavian countries, which are characterized by high levels of unionization (Neumann et al, 1991) but, at the same time, the economic advantage of belonging to a union seems to be particularly small (Le Grand, 1989). In their study, they explained this by occurrence of substantial spillover effects.…”

Section: Introduction To the Chaptermentioning

confidence: 99%

Regression Results of the Union Impact on Pay Levels in New Zealand Public Service

Feinberg-Danieli¹

0

View full text Add to dashboard Cite

<p>International studies almost uniformly conclude that union members receive higher wages than their non-union counterparts. This study investigates differences between collective and individual salaries using the New Zealand State Services Commission's Human Resources Capability Survey 2005. It explores the impact of collective bargaining on pay by controlling for a large number of employee and employer characteristics. As very little research has been carried out on the subject in New Zealand, I focused on the international literature in order to identify the major factors that explain the magnitude of union/non-union wage differential. Major industrial changes, which have shaped the NZ public service bargaining structure and its outcomes are identified. A range of statistical tests are used to examine the pay differences between collective and individual agreements in New Zealand public service. I, first, carry out basic comparisons of the average collective and individual wages across gender, employment type, occupations, ethnicity, age, employer size and tenure, followed by numerous multivariate regressions to work out the true contributing factors to the union/non-union wage differential. Finally, I analyze the results in the unique NZ context to allow new ideas and theory to emerge and compare it to international trends. Looking at the basic comparisons, I found that, in the New Zealand public service, employees on individual agreements earn significantly higher wages then those who are covered by collective agreements. However, multivariate analyses have revealed a different picture. The study found that occupational composition is the largest contributor to the variability in collective/individual pay in NZPS. With the exception of the senior, high skilled and specialised employees, no pay differential was found between collective or individual agreements in the New Zealand public service.</p>

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Spillover, standardization and stratification: earnings determination in the United States and Norway

Cited by 11 publications

References 15 publications

Union Wage Effects: Does Membership Matter?

Union Wage Effects: Does Membership Matter?

Regression Results of the Union Impact on Pay Levels in New Zealand Public Service

Regression Results of the Union Impact on Pay Levels in New Zealand Public Service

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