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38 Indus. & Lab. Rel. Rev. 244 (1984-1985)
What Do Unions Do

handle is hein.journals/ialrr38 and id is 246 raw text is: REVIEW SYMPOSIUM

WHAT DO UNIONS DO? by RICHARD B. FREEMAN
and JAMES L. MEDOFF
EDITOR'S INTRODUCTION by JOHN F. BURTON, JR.*

F OR several reasons, What Do Unions Do?'
by Richard B. Freeman and James L.
Medoff is the most significant book on the
topic in recent years. The theses are pro-
vocative, including a number favorable to
unions. The authors are prominent, as
members of the Harvard Economics
Department. The arguments have been
previewed elsewhere, such as in the 1979
article in The Public Interest on The Two
Faces of Unionism. And the current pres-
entation is accessible to a general audience.
The result is a book that has been praised
by scholars such asJohn Kenneth Galbraith
and John T. Dunlop and reviewed in pop-
ular media such as The New York Times and
Business Week. These factors explain our
special treatment of the book: a brief sum-
mary followed by a series of comments by
prominent scholars.
The central message of Freeman and
Medoff (F&M) is that there are two faces
to unions-one with largely undesirable
consequences for society and one with
largely beneficial results-and the empiri-
cal evidence demonstrates that the bene-
*John F. Burton,Jr., is a Professor at the New York
State School of Industrial and Labor Relations, Cor-
nell University, and Associate Editor of the Industrial
and Labor Relations Review.
'New York: Basic Books, 1984. x, 293 pp. $22.95.

ficial face predominates. The undesirable
side of unions is the monopoly face, which
enables unions to raise wages above the
competitive level. The desirable side is the
collective voice-institutional response face,
which enables unions to channel worker
discontent into improved workplace con-
ditions. The empirical evidence consists of
new sets of data on workers, firms, and
other actors in the industrial relations sys-
tem that the authors, their students and
colleagues, and other scholars have ana-
lyzed during the last decade.
One example of the empirical analysis
concerns the union impact on relative
wages. F & M conclude that union workers
earned about 30 percent more than com-
parable nonunion workers in 1980, the
largest such advantage since the depression
and one that could not be sustained in the
1980s, as witness the negotiated give-backs
in recent years. The monopoly face of
unions stresses the loss of economic effi-
ciency resulting from such union wage
advantages, but F & M find the loss in 1980
was only 0.2 percent of GNP. Moreover,
F & M also note the salubrious conse-
quences of the union relative wage impact,
such as substantially reducing the inequal-
ity of wages among the overall workforce
by about 3 percent.
The main thrust of the F & M analysis is

Industrial and Labor Relations Review, Vol. 38, No. 2 (January 1985). © 1985 by Cornell University.
0019-7939/85/3802 $01.00

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