Why so Unhappy? The Effect of Union Membership on Job Satisfaction

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IZA Seminar

Place: Schaumburg-Lippe-Str. 9, 53113 Bonn

Date: 01.04.2003, 12:15 - 13:30

   

Presentation by 

Claudio Lucifora (Università Cattolica del Sacro Cuore)
   

Abstract:

We investigate the effect of union membership on job satisfaction. We account for the endogenous
selection induced by the sorting of workers into unionised jobs and use different methodologies to
address the question of how the membership decision is related to overall job satisfaction and to
satisfaction with pay. We analyse linked employer-employee data from the 1998 British Workplace
Employee Relations Survey (WERS) using Propensity Score Matching and Instrumental Variables
techniques. Both the linked structure of the data analysed and the estimation strategies employed
allow us to deal with the limitations characterising the existing literature. We find that once the
endogeneity of membership is accounted for, the unhappiness of union members disappears,
suggesting that their reported dissatisfaction stems from individual unobservable attributes rather
than from the union status, i.e. unionisation has no causal effect on satisfaction. When satisfaction
with pay is considered, the union/non-union satisfaction differential drops considerably,
consistently with the existence of wage premia in favour of members.

   
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