High Union Density Research Articles

The Minimum Wage and Regional Wage Structure: Implications for Income Distribution

When the minimum wage was first enacted in 1938, the fiercest opposition came from the South, where wages were considerably lower that in the industrial North. Today, that opposition is found to emanate from states that have right-to-work laws (regardless of location). Using census data from the Integrated Public Use Microdata Series (IPUMS) for the years 1940 to 1990, this paper looks at workers earning around the minimum wage by region and industry. It shows that, controlling for education and industry type, wages tend to be depressed more in states with right-to-work legislation than in high union density states. These effects on the wage structure have implications for the distribution of income.

On the Complementarity between Education and Training in Europe

This paper is an empirical investigation of the complementarity between education and training in 13 European countries, based on the European Community Household Panel (ECHP). After confirming the standard result that training incidence is higher among individuals with more education, I find that the relationship between individual educational attainment and training incidence varies significantly across countries and birth cohorts. I show that individuals have a higher training incidence in countries with a more educated labour force, a less stratified schooling system, a higher union density, stronger employment protection and a lower value of the Kaitz index. I also find evidence that individuals with more education and relatively short labour market experience enjoy higher private returns from recent training than individuals with the same experience and less education. More experienced individuals with higher education, however, have lower returns from recent training than less educated workers with the same experience.

Asset‐Specific Investment and Unionized Labor

This article investigates the bargaining problem that exists when firms make asset‐specific investments and then are subject to excessive union wage demands. In this context, the combination of both large asset specific investment and high union density is important in determining the magnitude of the bargaining problem. Using firm‐specific union‐density rates and various asset‐specificity proxies, evidence is found that the bargaining problem results in substantially lower firm profitability, investment, and employment.

Collective Bargaining Coverage under Trade Unionism: A Sociological Investigation

Does high union density lead to high collective bargaining coverage? Since collective bargaining is seen as the raison d'être of trade unions, this is often assumed to be the case; some observers think that union density is ‘a floor’ below which collective bargaining coverage is unlikely to fall. With its very high union density, Denmark is a case in point. This article investigates the collective bargaining coverage issue in the Danish case, based on an individual‐level employee survey with 1720 respondents. Collective bargaining coverage is shown to be much lower than union density, and some methodological issues in this connection are considered. In order to find some possible explanations for this surprising finding, the question of variance of collective bargaining coverage between groups of employees is discussed in the light of theories of service society and recent research results and theories. The impact of central variables is investigated through multivariate analysis, and it turns out that by far the most important variable predicting an employee's collective bargaining coverage is a variable mostly neglected in comparative analyses: occupational status. Salaried employees have a much lower collective bargaining coverage than manual workers in Denmark, and some possible reasons for this are given.

Social Democracy and Bargaining: A Hypothetical Comparative System

Social democratic systems are characterized in their operation by the central role of bargains between governments and unions over distribution, wages, and welfare payments. Frequently expressed in the literature is the idea that unions represent the interests of workers and that bargains between unions and government are crucial to working class support.' If so, then central in understanding the rise, and seeming decline, of social democracies are questions about the effect of the bargaining process on the size and density of trade unions, the distribution of resources, and the interests of various groups of workers.2 The links between unions and social democratic arrangements and the importance of the level of unionization are well recognized, and there is already a substantial literature on these questions. This literature points to a number of regularities. Among them is the fact that unions have not shown any tendency to form classwide organizations. Another is that smaller countries like Australia, Sweden, Austria, and Norway tend to have higher union density and social democratic institutions more often than larger countries.3 These tendencies are attributed to a number of factors, including the divisive influence of the dominant ideology on working class solidarity, the domestic and international economic structure, and costs of union formation.4 This list also includes a number of ad hoc variables such as memories of repression and other accidents of history.5 The striking feature of the literature, however, is the relative lack of systematic research that focuses on the effect of the bargaining process itself on these regularities. In particular, little attention has been given in a bargaining, or any other, framework to the differences in union density among countries.6 Given the bargaining nature of social democracies and the strong correlation between the level of unionization and support for social democracy and redistributive programs, these omissions are significant.7 The purpose of this paper is to fill some of these gaps. The requirement that such an approach should be systematic is in keeping with the observation of a number of writers, such as Lehmbruch, Lange, and Regini, who argue that a more analytical, rational choice approach to union formation and agreements with government is required in order to supplement the mainly empirical and post hoc existing studies.8

UK Unionism and Innovative Activity: Some Cautionary Remarks on the Basis of a Simple Cross‐country Test

Abstract: This paper offers a preliminary investigation of union impact on investment in intangible capital. We first report evidence on the raw correlation between union membership density and R&D intensity. This suggests that higher union density is associated with increased innovative activity among an important subset of British industry. Attention then shifts to a consideration of whether the ‘stylized facts’ are indicative of a causal relation or are instead an artefact produced by the concentration of unions in those sectors evincing greater scope for R&D. We offer a simple cross‐country test in which German R&D outlays serve as the benchmark or comparator. No support is adduced for the notion that unions cause higher R&D.

Semi-unionized bargaining with endogenous membership and management opposition

This paper develops a model of open shop unions and efficient bargain, in which there is a social custom to unionize and the firms can pay wage premiums to dissuade union membership. If firms actively oppose unions, the union density turns out to be affected by changes of the product price and the reservation wage, and it is not always positively correlated with the workers' income share. Moreover, the model provides a rationale for higher union density in centralized as opposed to decentralized bargaining systems.

CLOSED SHOPS AND RELATIVE PAY: INSTITUTIONAL ARRANGEMENTS OR HIGH DENSITY?

Employees in workplaces with a closed shop get paid more than their counterparts in comparable workplaces without a closed shop. Is this pay differential a consequence of high union density or the institution of the closed ship itself? The authors' results indicate that a post-entry closed shop adds no extra pay differential over and above that achieved by employees in workplaces with high union density but no closed shop. By contrast the preentry closed shop--where the union normally controls the labor supply and has the potential to impose substantial costs on the employer by striking--roughly doubles the premium gained by high density alone. The implications of their results for the likely impact on union wage premia of recent legal changes outlawing the closed shop are discussed. Copyright 1992 by Blackwell Publishing Ltd

Inequality in the Working Class: The Unanticipated Consequences of Union Organization and Strikes

This paper explores one possible explanation for the uniquely apolitical character of the U.S. labor movement compared to the labor movements of other Western capitalist democracies. Employing a neo-Marxist class perspective, the author examines the relationship of union density (union members as a percentage of the nonagricultural work force) and of strike frequency to the distribution of earned income in the United States from 1949 to 1976. Time-series regression analysis of the quintile distribution of earned income and the Gini index of the inequality of earned income shows that union density has had mixed effects on inequality, with higher union density tending to redistribute income from middle-income workers to both the least prosperous and most prosperous workers, whereas higher strike frequency has tended to reduce income inequality generally. The author suggests that union organization may be a source of divisiveness within the working class in the postwar era.