Unionization and Productivity: Micro-Econometric Evidence

It is widely agreed that unionization affects the rules and procedures governing the employment relation in organized establishments. The effect of these changes on establishment productivity, however, is unclear. This issue is examined using establishment level data from the U. S. cement industry. A positive union effect on the order of 6–8 percent is found in both cross-section and time series data. Although some caution is in order in interpreting the results, the evidence suggests that unionization can lead to productive changes in the operation of the enterprise.