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The union wage effect and ability bias: Evidence from Ireland

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  • Walsh, Frank
Abstract
We use longitudinal data from an Irish household survey to measure the union wage premium. A subsample in which 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

  • Walsh, Frank, 2013. "The union wage effect and ability bias: Evidence from Ireland," Economics Letters, Elsevier, vol. 119(3), pages 296-298.
    • Handle: RePEc:eee:ecolet:v:119:y:2013:i:3:p:296-298
    DOI: 10.1016/j.econlet.2013.02.034
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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.
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    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.
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    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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