Journal of Labor Research

, Volume 8, Issue 4, pp 369–383 | Cite as

Union-nonunion wage differentials revisited

  • Harry C. Benham


A reverse regression method of estimating the union-nonunion wage differential is developed using a multiple indicator model. The method provides a test for the multiple indicator model’s validity and suggests that conventional estimation techniques should underestimate the union-nonunion differential. Empirical estimates show that the reverse regression estimates are larger than conventional estimates and that the multiple indicator model cannot be rejected.


Union Membership Monopoly Power Likelihood Ratio Test Statistic Union Worker Labor Market Experience 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.


Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.


  1. Abowd, J. and H. Farber. “Job Queues and Union Status.”Industrial and Labor Relations Review (April 1982): 354–67.Google Scholar
  2. Ashenfelter, O. and G. Johnson. “Unionism, Relative Wages, and Labor Quality in U.S. Manufacturing Industries.”International Economic Review (October 1972): 488–503.Google Scholar
  3. Becker, G.Human Capital. 2nd ed. Chicago: University of Chicago Press, 1975.Google Scholar
  4. Blakemore, A., J. Hunt, and B. F. Kiker. “Collective Bargaining and Union Membership Effects on the Wages of Male Youths.”Journal of Labor Economics (April 1986): 193–211.Google Scholar
  5. Conway, D. and V. Roberts. “Reverse Regression, Fairness, and Employment Discrimination.”Journal of Business and Economic Statistics (January 1983): 75–85.Google Scholar
  6. Duncan, G. and D. Leigh. “Wage Determination in the Union and Nonunion Sectors: A Sample Selectivity Approach.”Industrial and Labor Relations Review (October 1980): 24–34.Google Scholar
  7. Duncan, G. and F. Stafford. “Do Union Members Receive Compensating Wage Differentials?”American Economic Review (June 1980): 355–71.Google Scholar
  8. Farber, H. “The Determination of the Union Status of Workers.”Econometrica (September 1983): 1417–38.Google Scholar
  9. Filer, R. “The Influence of Effective Human Capital on the Wage Equation.” In R.G. Ehrenberg, ed.Research in Labor Economics. Vol. 4. Greenwich, Connecticut: JAI Press, 1981, pp. 367–416.Google Scholar
  10. Freeman, R. and J. Medoff.What Do Unions Do? New York: Basic Books, 1984.Google Scholar
  11. _____. “The Impact of Collective Bargaining: Can the New Facts Be Explained by Monopoly Unionism?” In R.G. Ehrenberg, ed.Research in Labor Economics, Supplement 2. 1983, pp. 293–332.Google Scholar
  12. Goldberger, A.S. “Reverse Regression and Salary Discrimination.”Journal of Human Resources (Summer 1984): 293–318.Google Scholar
  13. Heckman, J.J. “Sample Selection as a Specification Error.”Econometrica (January 1979): 153–61.Google Scholar
  14. Jovanovic, B. “Job Matching and the Theory of Turnover.”Journal of Political Economy (October 1979): 972–90.Google Scholar
  15. Kahn, L. “Unionism and Relative Wages: Direct and Indirect Effects.”Industrial and Labor Relations Review (July 1979): 520–32.Google Scholar
  16. Kamalich, R.A. and S.W. Polachek. “Discrimination: Fact or Fiction? An Examination Using an Alternative Approach.”Southern Economic Journal (October 1982): 450–61.Google Scholar
  17. Lee, L.F. “Unionism and Wage Rates: A Simultaneous Equations Model with Qualitative and Limited Dependent Variables.”International Economic Review (June 1978): 415–33.Google Scholar
  18. Lewis, H.G.Unionism and Relative Wages in the United States. Chicago: University of Chicago Press, 1963.Google Scholar
  19. _____.Union Relative Wage Effects: A Survey. Chicago: University of Chicago Press, 1986.Google Scholar
  20. Parsley, C.J. “Labor Unions and Wages: A Survey.”Journal of Economic Literature (March 1980): 1–31.Google Scholar

Copyright information

© Journal of Labor Research 1987

Authors and Affiliations

  • Harry C. Benham
    • 1
  1. 1.University of OklahomaNorman

Personalised recommendations