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The Union Wage Effect and Ability Bias: Evidence from Ireland

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  • Frank Walsh

Abstract

We use longitudinal data from an Irish household survey to measure the union wage premium. A sub-sample where the worker's payslip was seen by the interviewer is unlikely to have measurement error for the union variable. The results support the finding that measurement error leads to a large downward bias in fixed effects estimates of the union effect but indicate that ability bias has a small effect on the average union wage premium.

Suggested Citation

  • Frank Walsh, 2013. "The Union Wage Effect and Ability Bias: Evidence from Ireland," Open Access publications 10197/8042, School of Economics, University College Dublin.
    • Handle: RePEc:ucn:oapubs:10197/8042
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    File URL: http://hdl.handle.net/10197/8042
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    1. Lixin Cai & C. Jeffrey Waddoups, 2011. "Union Wage Effects in Australia: Evidence from Panel Data," British Journal of Industrial Relations, London School of Economics, vol. 49(Supplemen), pages 279-305, July.
    2. Barry T. Hirsch, 2004. "Reconsidering Union Wage Effects: Surveying New Evidence on an Old Topic," Journal of Labor Research, Transaction Publishers, vol. 25(2), pages 233-266, April.
    3. Koevoets, Wim, 2007. "Union wage premiums in Great Britain: Coverage or membership?," Labour Economics, Elsevier, vol. 14(1), pages 53-71, January.
    4. Gittleman, Maury & Pierce, Brooks, 2007. "New estimates of union wage effects in the U.S," Economics Letters, Elsevier, vol. 95(2), pages 198-202, May.
    5. Freeman, Richard B, 1984. "Longitudinal Analyses of the Effects of Trade Unions," Journal of Labor Economics, University of Chicago Press, vol. 2(1), pages 1-26, January.
    6. George Jakubson, 1991. "Estimation and Testing of the Union Wage Effect Using Panel Data," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 58(5), pages 971-991.
    7. John T. Addison & Claus Schnabel (ed.), 2003. "International Handbook of Trade Unions," Books, Edward Elgar Publishing, number 2705.
    8. David G. Blanchflower & Alex Bryson, 2010. "The Wage Impact of Trade Unions in the UK Public and Private Sectors," Economica, London School of Economics and Political Science, vol. 77(305), pages 92-109, January.
    9. Mellow, Wesley S, 1981. "Unionism and Wages: A Longitudinal Analysis," The Review of Economics and Statistics, MIT Press, vol. 63(1), pages 43-52, February.
    10. Barry T. Hirsch & Edward J. Schumacher, 1998. "Unions, Wages, and Skills," Journal of Human Resources, University of Wisconsin Press, vol. 33(1), pages 201-219.
    11. Card, David, 1996. "The Effect of Unions on the Structure of Wages: A Longitudinal Analysis," Econometrica, Econometric Society, vol. 64(4), pages 957-979, July.
    12. Robinson, Chris, 1989. "The Joint Determination of Union Status and Union Wage Effects: Some Tests of Alternative Models," Journal of Political Economy, University of Chicago Press, vol. 97(3), pages 639-667, June.
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    Cited by:

    1. Nikolov, Plamen & Jimi, Nusrat & Chang, Jerray, 2020. "The Importance of Cognitive Domains and the Returns to Schooling in South Africa: Evidence from Two Labor Surveys," Labour Economics, Elsevier, vol. 65(C).

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    More about this item

    Keywords

    Union wage premium; Ability bias; Measurement error;
    All these keywords.

    JEL classification:

    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs

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