IDEAS home Printed from https://ideas.repec.org/p/iae/iaewps/wp2007n017.html
   My bibliography  Save this paper

Union Wage Effects in Australia: Are There Variations in Distribution?

Author

Listed:
  • Lixin Cai

    (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne)

  • Amy Y.C. Liu

    (Crawford School of Economics and Government, Australian National University)

Abstract

Previous research on union wage effects in Australia has focused on the central parts of the conditional wage distribution. This study uses quantile regression models to examine whether the union wage effect varies across the (conditional) wage distribution. The data draw upon the first four waves of the Household, Income and Labour Dynamics in Australia (HILDA) survey. Union wage premiums are found across almost the entire wage distribution for both males and females. While for males it is evident that the union wage effect decreases when moving up the wage distribution, the effect for females is relatively stable except at the extremities of the distribution. Overall, unions are found to have a larger effect on male than on female wages. The decomposition results show that for males, the union wage effect explains a substantial proportion of the observed wage gap between union and non-union workers; this is not the case for females.

Suggested Citation

  • Lixin Cai & Amy Y.C. Liu, 2007. "Union Wage Effects in Australia: Are There Variations in Distribution?," Melbourne Institute Working Paper Series wp2007n017, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
    • Handle: RePEc:iae:iaewps:wp2007n017
    as

    Download full text from publisher

    File URL: http://melbourneinstitute.unimelb.edu.au/downloads/working_paper_series/wp2007n17.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Andrews, Martyn J. & Stewart, Mark B. & Swaffield, Joanna K. & Upward, Richard, 1998. "The estimation of union wage differentials and the impact of methodological choices," Labour Economics, Elsevier, vol. 5(4), pages 449-474, December.
    2. Mark Wooden, 2001. "Union Wage Effects in the Presence of Enterprise Bargaining," The Economic Record, The Economic Society of Australia, vol. 77(236), pages 1-18, March.
    3. G. Reza Arabsheibani & Alan Marin, 2001. "Union Membership and the Union Wage Gap in the UK," LABOUR, CEIS, vol. 15(2), pages 221-236, June.
    4. Moshe Buchinsky, 1998. "Recent Advances in Quantile Regression Models: A Practical Guideline for Empirical Research," Journal of Human Resources, University of Wisconsin Press, vol. 33(1), pages 88-126.
    5. Virginia Christie, 1992. "Union Wage Effects and the Probability of Union Membership," The Economic Record, The Economic Society of Australia, vol. 68(1), pages 43-56, March.
    6. Jacob A. Mincer, 1974. "Schooling, Experience, and Earnings," NBER Books, National Bureau of Economic Research, Inc, number minc74-1, June.
    7. Hiau Joo Kee, 2006. "Glass Ceiling or Sticky Floor? Exploring the Australian Gender Pay Gap," The Economic Record, The Economic Society of Australia, vol. 82(259), pages 408-427, December.
    8. Alan S. Blinder, 1973. "Wage Discrimination: Reduced Form and Structural Estimates," Journal of Human Resources, University of Wisconsin Press, vol. 8(4), pages 436-455.
    9. José Mata & José A. F. Machado, 2005. "Counterfactual decomposition of changes in wage distributions using quantile regression," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 20(4), pages 445-465.
    10. repec:bla:ecorec:v:68:y:1992:i:200:p:43-56 is not listed on IDEAS
    11. Melly, Blaise, 2005. "Decomposition of differences in distribution using quantile regression," Labour Economics, Elsevier, vol. 12(4), pages 577-590, August.
    12. Idson, Todd L & Feaster, Daniel J, 1990. "A Selectivity Model of Employer-Size Wage Differentials," Journal of Labor Economics, University of Chicago Press, vol. 8(1), pages 99-122, January.
    13. Jacob A. Mincer, 1974. "Schooling and Earnings," NBER Chapters, in: Schooling, Experience, and Earnings, pages 41-63, National Bureau of Economic Research, Inc.
    14. David Blanchflower & Alex Bryson, 2002. "Changes over time in union relative wage effects in the UK and the US revisited," NBER Working Papers 9395, National Bureau of Economic Research, Inc.
    15. David H. Autor & Lawrence F. Katz & Melissa S. Kearney, 2005. "Rising Wage Inequality: The Role of Composition and Prices," Harvard Institute of Economic Research Working Papers 2096, Harvard - Institute of Economic Research.
    16. David G. Blanchflower & Richard B. Freeman, 1990. "Going Different Ways: Unionism in the U.S. and Other Advanced O.E.C.D. Countries," NBER Working Papers 3342, National Bureau of Economic Research, Inc.
    17. Mark Wooden & Simon Freidin & Nicole Watson, 2002. "The Household, Income and Labour Dynamics in Australia (HILDA)Survey: Wave 1," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 35(3), pages 339-348, September.
    18. Rene Morissette, 1993. "Canadian Jobs and Firm Size: Do Smaller Firms Pay Less?," Canadian Journal of Economics, Canadian Economics Association, vol. 26(1), pages 159-174, February.
    19. N. C. O'Leary & P. D. Murphy & D. H. Blackaby, 2004. "Quantile Regression Estimates of the Union Wage Effect for Great Britain," Manchester School, University of Manchester, vol. 72(4), pages 497-514, July.
    20. Sap, Jolande, 1993. "Bargaining power and wages : A game-theoretic model of gender differences in union wage bargaining," Labour Economics, Elsevier, vol. 1(1), pages 25-48, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Siminski, Peter, 2008. "What Would the Average Public Sector Employee be Paid in the Private Sector?," Economics Working Papers wp08-05, School of Economics, University of Wollongong, NSW, Australia.
    2. Bosio, Giulio, 2009. "Temporary employment and wage gap with permanent jobs: evidence from quantile regression," MPRA Paper 16055, University Library of Munich, Germany.
    3. Denise Doiron & Rochelle Guttmann, 2009. "Wealth Distributions of Migrant and Australian‐born Households," The Economic Record, The Economic Society of Australia, vol. 85(268), pages 32-45, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Lixin Cai & Amy Y.C. Liu, 2008. "Union Wage Effects in Australia: Is There Variation along the Distribution?," The Economic Record, The Economic Society of Australia, vol. 84(267), pages 496-510, December.
    2. Lixin Cai & Amy Y.C. Liu, 2008. "Public-Private Wage Gap in Australia: Variation Along the Distribution," CEPR Discussion Papers 581, Centre for Economic Policy Research, Research School of Economics, Australian National University.
    3. Lixin Cai & Amy Y. C. Liu, 2011. "Public–Private Sector Wage Gap in Australia: Variation along the Distribution," British Journal of Industrial Relations, London School of Economics, vol. 49(2), pages 362-390, June.
    4. Massimiliano Agovino & Antonio Garofalo, 2016. "The Impact of Education on Wage Determination between Workers in Southern and Central-Northern Italy," Panoeconomicus, Savez ekonomista Vojvodine, Novi Sad, Serbia, vol. 63(1), pages 25-43, March.
    5. Domenico Depalo & Raffaela Giordano & Evangelia Papapetrou, 2015. "Public–private wage differentials in euro-area countries: evidence from quantile decomposition analysis," Empirical Economics, Springer, vol. 49(3), pages 985-1015, November.
    6. Arceo-Gómez, Eva O. & Campos-Vázquez, Raymundo M., 2014. "Evolución de la brecha salarial de género en México," El Trimestre Económico, Fondo de Cultura Económica, vol. 0(323), pages .619-653, julio-sep.
    7. Claudia Tello & Raul Ramos & Manuel Artís, 2012. "Changes in wage structure in Mexico going beyond the mean: An analysis of differences in distribution, 1987-2008," Working Papers XREAP2012-07, Xarxa de Referència en Economia Aplicada (XREAP), revised May 2012.
    8. Shantanu Khanna, 2012. "Gender wage discrimination in India-- Glass ceiling or sticky floor?," Working papers 214, Centre for Development Economics, Delhi School of Economics.
    9. Boll, Christina & Leppin, Julian Sebastian, 2013. "Unterwertige Beschäftigung von Akademikerinnen und Akademikern: Umfang, Ursachen, Einkommenseffekte und Beitrag zur geschlechtsspezifischen Lohnlücke," HWWI Policy Papers 75, Hamburg Institute of International Economics (HWWI).
    10. Mustafizur Rahman & Marzuka Md. Al-Hasan, 2019. "Women in Bangladesh Labour Market: Determinants of Participation, Gender Wage Gap and Returns to Schooling," CPD Working Paper 124, Centre for Policy Dialogue (CPD).
    11. David H. Autor & Lawrence F. Katz & Melissa S. Kearney, 2005. "Trends in U. S. Wage Inequality: Re-Assessing the Revisionists," Harvard Institute of Economic Research Working Papers 2095, Harvard - Institute of Economic Research.
    12. Christian Manuel Posso, 2010. "Desigualdad salarial en Colombia 1984-2005: cambios en la composición del mercado laboral y retornos a la educación post-secundaria," Revista Desarrollo y Sociedad, Universidad de los Andes,Facultad de Economía, CEDE, December.
    13. Boris Kaiser, 2016. "Decomposing differences in arithmetic means: a doubly robust estimation approach," Empirical Economics, Springer, vol. 50(3), pages 873-899, May.
    14. Jacqueline Mosomi, 2019. "Distributional changes in the gender wage gap in the post-apartheid South African labour market," WIDER Working Paper Series wp-2019-17, World Institute for Development Economic Research (UNU-WIDER).
    15. Zheng Fang & Chris Sakellariou, 2011. "A Case of Sticky Floors: Gender Wage Differentials in Thailand," Asian Economic Journal, East Asian Economic Association, vol. 25(1), pages 35-54, March.
    16. Dileni Gunewardena & Darshi Abeyrathna & Amalie Ellagala & Kamani Rajakaruna & Shobana Rajendran, 2008. "Glass Ceilings, Sticky Floors or Sticky Doors? A Quantile Regression Approach to Exploring Gender Wage Gaps in Sri Lanka," Working Papers PMMA 2008-04, PEP-PMMA.
    17. Cho, Sungwook & Heshmati, Almas, 2013. "What If You Had Been Less Fortunate: The Effects of Poor Family Background on Current Labor Market Outcomes," IZA Discussion Papers 7708, Institute of Labor Economics (IZA).
    18. Danijel Nestic, 2010. "The Gender Wage Gap in Croatia – Estimating the Impact of Differing Rewards by Means of Counterfactual Distributions," Croatian Economic Survey, The Institute of Economics, Zagreb, vol. 12(1), pages 83-119, April.
    19. Dilaka Lathapipat, 2008. "The Changing Educational Distribution and its Impact on the Evolution of Wages in Thailand, 1987-2006," EABER Working Papers 21951, East Asian Bureau of Economic Research.
    20. Atencio,Andrea & Posadas,Josefina, 2015. "Gender gap in pay in the Russian Federation : twenty years later, still a concern," Policy Research Working Paper Series 7407, The World Bank.

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:iae:iaewps:wp2007n017. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sheri Carnegie (email available below). General contact details of provider: https://edirc.repec.org/data/mimelau.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.