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Journal Article

The Effect of Unions on the Structure of Wages: A Longitudinal Analysis

David Card
Econometrica
Vol. 64, No. 4 (Jul., 1996), pp. 957-979
Published by: The Econometric Society
DOI: 10.2307/2171852
Stable URL: http://www.jstor.org/stable/2171852
Page Count: 23
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The Effect of Unions on the Structure of Wages: A Longitudinal Analysis
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Abstract

This paper studies the effects of unions on the structure of wages, using an estimation technique that explicitly accounts for misclassification errors in reported union status, and potential correlations between union status and unobserved productivity. The econometric model is estimated separately for five skill groups using a large panel data set formed from the U.S. Current Population Survey. The results suggest that unions raise wages more for workers with lower levels of observed skills. In addition, the patterns of selection bias differ by skill group. Among workers with lower levels of observed skill, unionized workers are positively selected, whereas union workers are negatively selected from among those with higher levels of observed skill.

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