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Union membership, union coverage and wage dispersion of rural migrants: Evidence from Suzhou industrial sector

Wen Wang and Donald Lien

China Economic Review, 2018, vol. 49, issue C, 96-113

Abstract: Using the data from an original survey on rural migrant workers from Suzhou industrial sector in 2013, we estimate the wage effect of both union membership and union coverage across the wage distributions using decomposition approach based on unconditional quantile regression. The results show that union membership has a significant effect on the wage level of rural migrant workers across the wage distribution. The effect of coefficient differences which results from the different rewarding systems explains the majority wage differentials between union members and non-members in non-unionized firms. There is also significant union coverage effect at the lower part of the distribution when comparing the union-covered non-member to the nonunion-covered non-member, which is also mainly caused by the coefficient effect. By contrast, wage differentials between union members and non-members in unionized firms are attributed to significant composition effect, which reveals that union members are positively selected within unionized firms. As a result, the positive wage effect of union is limited to the more advantaged group among migrant workers.

Keywords: Migrant worker; Union; Wage effect; Quantile regression; China (search for similar items in EconPapers)
JEL-codes: J51 R23 D31 J31 (search for similar items in EconPapers)
Date: 2018
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China Economic Review is currently edited by B.M. Fleisher, K. X. D. Huang, M.E. Lovely, Y. Wen, X. Zhang and X. Zhu

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Handle: RePEc:eee:chieco:v:49:y:2018:i:c:p:96-113