Union Wage Effects in Australia: Evidence from Panel Data

Lixin Cai and C. Waddoups ()

No 914, Working Papers from University of Nevada, Las Vegas , Department of Economics

Abstract: Using data from the Household, Income and Labour Dynamics in Australia (HILDA) Survey, our research indicates that unobserved heterogeneity substantially biases cross-sectional estimates of union wage effects upward for both males and females. Estimates of the union wage premium for male workers between the ages of 25 and 64 fall from 8.7% to 5.2% after controlling for unobserved heterogeneity. For females age 25 to 63 the estimated 4.0% cross-sectional union wage premium falls to 1.9% once unobserved heterogeneity is controlled for. Our results also indicate positive sorting by unobserved skills into union membership, especially among low skilled male and female workers. There is also evidence of negative sorting into unions among the most highly skilled.

Keywords: union wage effects; fixed effects models; panel data JEL codes: JEL: J31, J51 (search for similar items in EconPapers)
JEL-codes: J31 J51 (search for similar items in EconPapers)
Pages: 36 pages
Date: 2009-01
New Economics Papers: this item is included in nep-bec and nep-lab
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http://web.unlv.edu/projects/RePEc/pdf/0914.pdf First version, 2009 (application/pdf)
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Related works:
Journal Article: Union Wage Effects in Australia: Evidence from Panel Data (2011)
Working Paper: Union Wage Effects in Australia: Evidence from Panel Data (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:nlv:wpaper:0914

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