Unionization and the Evolution of the Wage Distribution in Sweden: 1968 to 2000

Posted: 17 Oct 2011

See all articles by James Albrecht

James Albrecht

Georgetown University - Department of Economics; CESifo (Center for Economic Studies and Ifo Institute); IZA Institute of Labor Economics

Anders Bjorklund

Stockholm University; IZA Institute of Labor Economics

Susan Vroman

Georgetown University; IZA Institute of Labor Economics

Multiple version iconThere are 2 versions of this paper

Date Written: October 1, 2011

Abstract

Using the 1968, 1981, and 2000 Swedish Level of Living Surveys, the authors examine the evolution of the wage distribution in Sweden over the periods 1968-1981 and 1981-2000. The first period was the heyday of the Swedish solidarity wage policy with strong equalization clauses in the central wage agreements. During the second period, there was more flexibility for firms to adjust wages to reflect conditions such as labor shortages in particular fields. The authors find a remarkable narrowing of the wage distribution in the first period, but in the second period, wages grew more equally across the distribution. The authors decompose these changes in wages across the distribution into two components of those due to changes in the distribution of characteristics such as education and experience and those due to changes in the distribution of returns to those characteristics. They find that the wage compression between 1968 and 1981 was driven by changes in the distribution of returns, but between 1981 and 2000, the change in the distribution of returns had less of an effect on wage compression.

Keywords: wage compression, unionization, quantile regression

JEL Classification: J51, J30

Suggested Citation

Albrecht, James W. and Bjorklund, Anders and Vroman, Susan B., Unionization and the Evolution of the Wage Distribution in Sweden: 1968 to 2000 (October 1, 2011). Industrial and Labor Relations Review, Vol. 64, No. 5, 2011. Available at SSRN: https://ssrn.com/abstract=1945289

James W. Albrecht (Contact Author)

Georgetown University - Department of Economics ( email )

Washington, DC 20057
United States
202-687-6105 (Phone)
202-687-6102 (Fax)

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

HOME PAGE: http://www.CESifo.de

IZA Institute of Labor Economics

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Germany

Anders Bjorklund

Stockholm University ( email )

Swedish Institute for Social Research (SOFI)
S-106 91 Stockholm
Sweden
+46 8 163452 (Phone)
+46 8 154670 (Fax)

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Susan B. Vroman

Georgetown University ( email )

Washington, DC 20057
United States
202-687-6024 (Phone)
202-687-6102 (Fax)

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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