2020 Volume 71 Issue 3 Pages 394-410
Many industrialized countries have experienced increasing wage inequality and erosion of collective bargaining systems since the 1980s. Although several studies have revealed how unions affect trends in wage inequality in western countries, little is known about their effects in Japan. This study examines whether and how unions affected trends in Japanese wage inequality for male employees between 1985 and 2015. Using data from the Social Stratification and Mobility Survey（SSM） conducted in 1985 and 2015, we conducted Recentered Influence Function（RIF） regressions on the natural logarithm of wages and an extension of the Oaxaca-Blinder decomposition method that can be applied to various distributional measures. We found that unions compressed wage distribution in 1985, but not in 2015. Unions also contributed to the changes in wage distribution over this period, and composition effects linked to unions（the impact of de-unionization）increased wage inequality. On the other hand, the effects of unionsʼ wage structure reduced inequality at the low-end of the distribution. In 1985, union membership increased wages at the low-end and middle-end of the distribution and lowered wages at the top-end of the distribution, effectively widening the wage distribution at the lowend and equalizing the wage distribution at the top-end. However, in 2015, unions could no longer impact wages. Although this wage structure effect contributed to reducing wage inequality at the low-end, this study concluded that the impact of deunionization on increasing wage inequality was more robust than the unionsʼ wage structure effect.
