White-Collar Unions, Blue-Collar Unions, and Wages in Manufacturing

Abstract

This essay outlines the theory of an equilibrium wage differential between white collar and blue collar labor in a closed labor market. It then analyses the effect of unions of office workers and of plant workers on this wage differential in order to estimate the potential effects of an increase in the extent of unionism in the white collar sector. In addition to discussing differences in wage behavior between white and blue collar unions this study should also provide predictions about the degree to which increasing unionization in offices will affect the attractiveness of office work for new entrants to the labor force. Moreover, it may, if we find that white collar unions have only slight wage effects, allay the fears of employers about the potential of these unions for disrupting customary wage relationships.