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Exploring reasons why cross-section analysis underestimates the union premium in Korea

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  • Cho Joonmo
  • Cheon Byung You

Abstract

This study evaluates the cartel effects of Korean labour unions from the perspectives of job separation and loss of wage premium. Unlike the previous cross-sectional analysis showing that the wage premium of Korean labour unions is small, a high level of wage premium was observed in unionized companies. This was more prominent among long tenured union workers and among union workers in monopoly firms than it was amongst workers in other comparable groups. This demonstrates that those who work in unionized companies and enjoy a high level of employment security concentrate on building up firm-specific skills, and not on building-up alternative skills as preparation for potential job turnover.

Suggested Citation

  • Cho Joonmo & Cheon Byung You, 2008. "Exploring reasons why cross-section analysis underestimates the union premium in Korea," Applied Economics Letters, Taylor & Francis Journals, vol. 15(5), pages 395-398.
    • Handle: RePEc:taf:apeclt:v:15:y:2008:i:5:p:395-398
    DOI: 10.1080/13504850600706057
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    References listed on IDEAS

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    1. repec:eee:labchp:v:2:y:1986:i:c:p:1139-1181 is not listed on IDEAS
    2. Karier, Thomas M, 1985. "Unions and Monopoly Profits," The Review of Economics and Statistics, MIT Press, vol. 67(1), pages 34-42, February.
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    Cited by:

    1. Fang, Tony & Hartley, John, 2022. "Evolution of Union Wages and Determinants," IZA Discussion Papers 15333, Institute of Labor Economics (IZA).
    2. Andrea Vaona, 2010. "A survival analysis approach to the duration of union membership in Italy," Applied Economics Letters, Taylor & Francis Journals, vol. 17(11), pages 1089-1093.

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