In this paper we compare the changing pattern of unionization in OECD countries, review existing evidence, and present new information on cross-country differences in union/non-union differentials in labour market outcomes, largely from the micro data files of the International Social Survey Programme cross-country surveys of 1985-1987. Our analysis shows that American unions have a larger effect on wages, but not on other outcomes, than unions in other countries. We argue that the high union wage premium in the US contributed to the decline in US union density and to the consequent divergence of the US industrial relations system from those in most OECD countries. Looking to the future, our findings suggest that US unions must make major innovations in their tactics and policies to regain a position of strength in the private sector and that the nation will have to develop new industrial relations institutions to avoid the Congress and the judiciary intervening frequently in workplace decisions
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