Search Results
Title: Union Wage Distortions and Investment in Schooling: Evidence from Continuing Education
Resulting in 1 citation.
| 1. |
Neelakantan, Pattabiraman |
|
Union Wage Distortions and Investment in Schooling: Evidence from Continuing Education Ph.D. Dissertation, State University of New York at Buffalo, 1992 Cohort(s): Young Men Publisher: UMI - University Microfilms, Bell and Howell Information and Learning Keyword(s): Behavior; Education, Adult; Educational Costs; Educational Returns; Schooling; Unions; Wage Effects Labor unions. as socio-political institutions, are believed to follow an egalitarian wage policy and distribute rent so as to equalize earnings; i.e., workers with lower wages get a larger share of the rent, and vice versa. Since human capital and wages are positively related, union workers with a lower human capital, measured by schooling, experience etc., receive larger wage gains and vice versa. The above relation is consistent with the empirical observation that wages are higher, but wage inequality is lower in unionized firms compared to nonunion firms. Higher wages, and lower wage inequality means that wage profiles in relation to any measure of human capital are higher and flatter in union jobs relative to nonunion jobs. In this study, I do not try to explain this egalitarian tendency of unions, but instead follow a "positive economics" approach. If the egalitarian argument is factual, then certain behavioral predictions follow, and these are the focus of my research. The basic thesis is that labor unions' seemingly egalitarian wage policies discourage worker investment in general human capital e.g., continuing education. The above result follows from the higher and flatter wage-schooling profile in union jobs, which on the one hand raises the opportunity cost of time for union workers, and on the other hand lowers the return to schooling. Hence, "union effect on continuing education" is to discourage worker enrollment in continuing education relative to nonunion sector. However, workers may take into account the union effect on continuing education while choosing union or nonunion sector. For example, at least two types of self-selection are possible: (i) workers with a lower innate demand for education may choose the union sector, and (ii) some workers may join the union sector initially, and later quit their union jobs to enroll in continuing education, using their union premium i.e., changes in union status may be negatively correlated with the changes in workers' schooling enrollment behavior. The above arguments imply that the net effect of unions on enroll Dent in continuing education may be smaller due to self-selection by workers. |
|
|
Bibliography Citation
Neelakantan, Pattabiraman. Union Wage Distortions and Investment in Schooling: Evidence from Continuing Education. Ph.D. Dissertation, State University of New York at Buffalo, 1992. |