From bargaining to balance: How unions shape gender wage outcomes

Women continue to earn less than men in OECD countries. Extensive research has explored various factors contributing to the gender wage gap. However, fewer studies have examined the impact of trade unions, despite their significant role in promoting equality. In this study, we exploit exogenous variation in tax scheme incentives for union members to identify the effect of trade unions on the gender wage gap in Norwegian private sector establishments. Using administrative register data on full-time private-sector workers in the period 2000–2014, we find that increases in union density reduce wage differences between women and men within establishments. A ten-percentage point increase in the workplace union density is estimated to reduce the gender wage gap by approximately 2.7 percentage points.