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This meta-study says the exact opposite. Can you defend your position empirically? https://www.nber.org/digest/digestsep18/new-evidence-unions-raise-wages-less

• deleted 2y ago
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• roenxi 2y ago
  1. I don't think that is a meta-study. It seems to be an attempt to build a dataset to track US union membership over long timeframes. 2. It notes that there is a correlation between union membership and inequality. Which is interesting but not that powerful - correlation is not causation. It might be that both trends are being driven by the financialisation of the US economy. 3. It finds that union households earn a premium over non-union households. Again, because of the nature of the study that doesn't tell us much about the impacts of unions. As an analogy, we might find that HN commentators earn more than non-HN commentators in the tech industry but that doesn't indicate that HN is pushing salaries up. Although in fairness I would suspect there probably is a causal element. But I still don't want to be in a unionised industry. I don't want a premium over other tech workers. I want to maximise the average tech worker salary and then be employed in tech. Those are very different objectives and require different strategies to achieve. Pro-union types tend to have a very short term view of the world and aren't about maximising long term returns. Strikes and collective bargaining don't move the needle in the right direction over the long term.
  • aesh2Xa1 2y ago
    You're right that this isn't a meta-study. It's a deep survey and references many similar studies, though. It certainly doesn't exist in a vacuum. "In this section, we explore in a more direct manner the relationship between unions and income inequality, joining an extensive empirical literature examining how unions shape the income distribution." You're right to point out that "correlation is not causation," but the study specifically addresses your concern and presents a strong argument for causation. It's not as if science can never demonstrate anything using correlation and statistical techniques, you know? https://xkcd.com/552/ https://xkcd.com/552/ "Correlation doesn’t imply causation, but it does waggle its eyebrows suggestively and gesture furtively while mouthing ‘look over there.'" > It notes that there is a correlation between union membership and inequality Specifically, it notes a robust INVERSE correlation that: * Increased union membership correlates to decreased inequality * Decreased union membership correlates to increased inequality > Which is interesting but not that powerful - correlation is not causation The authors acknowledge the statistical nature of correlation, and they addressed it (they say so right in the abstract). They used the following techniques to establish a causal relationship between union density and income inequality. * distributional decompositions * time series regressions * state-year regressions * instrumental-variable strategy based on historical events like the 1935 legalization of unions and the World War II–era War Labor Board > It might be that both trends are being driven by the financialisation of the US economy. The authors find that policy changes which significantly reduced the cost of union organizing (e.g., the Wagner Act and the National War Labor Board during WWII) led to lasting increases in state-level union density and corresponding reductions in income inequality. These effects were specific to the periods when these policies were active and had no similar impact in other times, such as during the Korean War, which did not explicitly promote union organization. This is a cause very different from a wild guess at "financialisation of the US economy." Furthermore, the study highlights that unions were particularly effective in reducing inequality by increasing the wages of less-educated and nonwhite workers. During periods of high union density, the wage gap between union and nonunion workers was substantial, contributing significantly to overall income equality. > It finds that union households earn a premium over non-union households. Again, because of the nature of the study that doesn't tell us much about the impacts of unions. The study does more than just observe a premium; it provides historical and statistical context to argue that the premium is associated with union activities, such as collective bargaining. The consistent premium over many decades, despite changes in union density, suggests a link between union presence and wage levels. In short, no, neither union membership or inequality are evidenced as show "both caused by financialization of the economy." They the latter correlated to the former, and was tested for causation. The former's uptake can include economic considerations, but it also correlated directly to governance policy directly targeting labor law.
    • roenxi 2y ago
      > They used the following techniques to establish a causal relationship between union density and income inequality. I don't think those techniques establish causal relationships. Which of these techniques do you think establishes a causal relationship? I can tell you right from the start that "time series regressions" don't establish a causal relationship. The paper established a very strong statistical relationship. Which is all very well but if you look in the paper [0] at Fig I you can see a very strong statistical relationship without any need for statistical methods. It leaps out of the graph at you. There was a pre-WWII period, the WWII-through-to-US-mini-peak-oil in the 70s and then the post-peak [1] regime (speaking loosely since shale oil has indeed been a miracle over the last decade - but it isn't the wealth engine that oil was back post WWII). There are a lot of interesting statistical correlations at around the same time. That is far too much background noise to claim that unions are the causal element. Geopolitics and cheap energy was more likely to causal. [0] https://www.nber.org/system/files/working_papers/w24587/w24587.pdf https://www.nber.org/system/files/working_papers/w24587/w245... [1] https://wtfhappenedin1971.com/ https://wtfhappenedin1971.com/
      • aesh2Xa1 2y ago
        > Which of these techniques do you think establishes a causal relationship? I can tell you right from the start that "time series regressions" don't establish a causal relationship. Hm, time series series regression is a standard, accepted approach to causal inference: https://towardsdatascience.com/inferring-causality-in-time-series-data-b8b75fe52c46 https://towardsdatascience.com/inferring-causality-in-time-s... For me, it suffices to say that the authors did not weakly position their argument as you claimed. I responded because I thought that claim was an attack, and that it was a careless regurgitation of the standard line about correlation. There's some author discussion here that might help get the points across: https://www.stone-econ.org/research/unions-and-inequality-over-the-20th-century-new-evidence-from-survey-data https://www.stone-econ.org/research/unions-and-inequality-ov... Here, also, is a third-party discussion: https://journalistsresource.org/economics/inequality-labor-unions/ https://journalistsresource.org/economics/inequality-labor-u... The data that the union papers authors used is here. Scroll to the bottom of the page to find "Supplementary data | qjab012_Online_Appendix - pdf file" https://academic.oup.com/qje/article/136/3/1325/6219103 https://academic.oup.com/qje/article/136/3/1325/6219103