Measuring Union Power in British Manufacturing: A Latent Variable Approach.

Empirical work on the effects of trade union power on economic variables such as wages, employment, productivity, and technological and organizational change has been severely hampered by the problems associated with quantifying union power, which is, by its nature, unobservable. Typically proxy variables have been used. None of the proxies used, however, captures the full spectrum of factors that result in power differentials across unions and workplaces. This paper proposes an entirely different approach, which involves treating union power explicitly as a 'latent' variable. The model is estimated on British workplace-level data for 1984. Copyright 1993 by Blackwell Publishing Ltd