WISERD invites you to the latest WISERD Lunchtime Seminar at Wednesday 22 October 12pm, presented by Dr Yongchao Jing (ADR Wales). You can find the link to the Microsoft Teams meeting via the event button at the bottom of the page.
In an era marked by the decline or stagnation of collective bargaining, this paper examines whether collective bargaining institutions—namely union density, collective bargaining coverage, bargaining centralization, and wage coordination—shape wage returns to skills and how these effects manifest for low- and high-skilled workers. Using a multilevel regression approach and data from the Programme for the International Assessment of Adult Competencies (PIAAC) for 29 OECD countries, the study estimates the moderating effects of collective bargaining institutions on the wage returns to cognitive and job-specific skills. The results show that union density, collective bargaining coverage, and wage coordination are all associated with lower returns to skills, but through distinct distributional patterns. Higher union density is associated with disproportionately higher wages for low-skilled workers, while broader collective bargaining coverage is associated with substantially lower wages for high-skilled workers. Greater wage coordination is linked to reduced returns to cognitive skills, reflected in higher wages for low- skilled workers and lower wages for high-skilled workers, while leaving returns to job-specific skills largely unaffected. By contrast, there is no evidence that bargaining centralization moderates skill returns. Overall, these findings suggest that different dimensions of collective bargaining institutions interact with individual skills in distinct ways to shape the wage distribution.