The Effects of Trade Unions on the Distribution of Earnings: A Sample Selectivity Approach.

Using individual microdata from six British local labor markets in 1986 containing information on both union membership and recognition the paper examines the influence of trade unions on both moments of the earnings distribution. The problem of sample selection and its impact on the estimated union wage differential is investigated. Finally the effect of union legislation on the union-mark-up is examined by comparison of the 1986 results with those of a similar study for 1975. There is evidence for both a positive wage mark-up and a reduction in earnings variability in the union sector. Further manual males do not appear to have fared as well as non-manual males between 1975 and 1986. Copyright 1992 by Blackwell Publishing Ltd