Striking a Deal? Strike threats and the business cycle in Mexico
Abstract
It is well documented that unions have effects on wages and non-wage benefits, these gains are obtained through collective bargaining. The theoretical literature motivates these gains as the products of successful bargains achieved using the threat of a strike as the bargaining signal. This paper provides a novel exploration of the bargaining signalling mechanism between unions and employers by exploiting administrative data on all strike threats in Mexico in the private sector 1991-2012. I explore the relationship between strike threats and the business cycle for a 20 year period and confirm their role in wage bargaining for workers.
What have Mexican unions done to wages over the last decade?
Abstract
Unions in Mexico have a long history of being co-opted by the state, given this historic discrepancy in behaviour, this paper seeks to analyse the effect of unions in the labour market. In the spirit of Freeman and Meddoff (1984), I ask: What do Mexican unions do to wages? This paper provides new evidence on the union wage gap over the last decade. The empirical work exploits the Mexican labour force survey survey. The analysis is divided into two parts: In the first, the magnitude of the union wage gap is investigated using the well known Oaxaca–Blinder decomposition. The potential issue of union selection is addressed through the application of a Lee (1978) endogenous switching model. Further estimates of the Union wage mark-up are obtained by exploiting the panel nature of the ENOE survey, to obtain an individual fixed-effects regression. I then give a synthesis of all of these competing estimates. In the final part of the analysis, I ask: ‘Did unions wield a ‘sword-of-justice’ across the wage distribution over the last decade?’ This is explored through the application of a variance decomposition and the use of quantile regression models.
The Mexican Wage Curve 2000-2003: A Quantile Analysis
Abstract
This paper exploits the Mexican Encuesta Nacional de Empleo Urbano (ENEU) to determine the existence of the wage curve an empirical phenomena first suggested by Blanchflower and Oswald (1990) during the period 2000-2003. We propose an innovative approach to the wage curve by estimating the elasticity across the wage distribution. This is applied to the Mexican experience during the early 2000s recession. The evidence indicates that for Mexico during this period there is no wage curve, and that wages are positively selected by local levels of unemployment. This lends credibility to the Harris and Todaro (1970) view which suggests that there is segmentation in the labour market with residual unemployment. We argue that perhaps the power of unions may account for our findings.
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Latin American Household Budget Surveys 1913-1970 and What They Tell Us about Economic Inequality among Households (with Gazeley, Newell, Reynolds & Lanata-Briones)
Abstract
The article reports an analysis of the findings of a search for household budget surveys for Latin America for the period from the earliest surveys to the late 1960s. Over one hundred studies were located. References to these surveys are available at http://www.sussex.ac.uk/ globalincomeinequality/ . In Appendix 1 we offer a synopsis of the history, context and contents of all the surveys, including those that did not contain useable data. We discuss the comparability of each country’s surveys in turn, offering a table for each country with indicator of size, scope and other features. Our final work is to model the progress of inequality, as reflected in Gini coefficients, 90/10 and 50/10 percentile ratios in the region. We find that the bulk of the measured rise is inequality from the 1930s to the 1960s is due to changing survey methods and objectives, in particular the expansion of the scope of the surveys from a narrow focus on urban manual worker-headed households to a later broad focus on the population. Finally, we predict the pattern of inequality over time that might have been found had the earlier surveys been unrestricted in terms of target population and randomly sampled. We find a modest increase from the early years to the 1960s in Gini inequality.
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Citation
Gazeley, Ian & Holmes, Rose & Lanata Briones, Cecilia & Newell, Andrew T. & Reynolds, Kevin & Rufrancos, Hector Gutierrez, 2018. “Latin American Household Budget Surveys 1913-1970 and What They Tell Us about Economic Inequality among Households,” IZA Discussion Papers 11430, Institute of Labor Economics (IZA).
Joining the dots and fitting curves: A practitioner’s guide to estimating income inequality using group data (with A Newell)
Abstract
One of the challenges of working with historical data relate to the passage of time. Often, the microdata of surveys no longer survives. This paper is a guide on how to estimate income inequality from tabulated results that may survive in reports. We consider various data structures and propose parametric estimation methods which overcome the lack of individual returns. Microsimulations using the 1953-54 UK MoL Survey (Gazeley et al., 2015) and the 1853 Survey of Belgian workers (Dupéctiaux, 1855), for which individual level data exist, are employed to demonstrate the performance of these methods once the data have been collapsed into groups on modern stratified data and snowball samples, respectively.