Wage inequality in stakeholder organizations: Evidence from US labor unions 1959-2022

Thomas Breda () and Paolo Santini ()
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Thomas Breda: PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - ENPC - École nationale des ponts et chaussées - IP Paris - Institut Polytechnique de Paris, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - ENPC - École nationale des ponts et chaussées - IP Paris - Institut Polytechnique de Paris
Paolo Santini: Institute for Employment Research - University of Warwick [Coventry]

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Abstract: Although unions advocate higher wages and greater equality, little is known about their own compensation practices. Using newly assembled administrative data covering more than one million observations on U.S. union workers, we show that unions practice what they preach. They pay wages that are, on average, almost 20 percent higher than those in private firms, yet are substantially more equally distributed. We show that this pattern cannot be explained by differences in skill dispersion or firm size. Instead, we trace it to institutions and norms that limit top pay, including internal member control and media-driven reputational sanctions. Our findings underscore how pay norms can shape wages in stakeholder organizations and identify the institutional channels through which such norms become effective.

Keywords: Inequality; Trade Unions; Transparency; Social Norms (search for similar items in EconPapers)
Date: 2026-04
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