The erosion of union membership in Germany: determinants, densities, decompositions

Unionization in Germany has declined considerably during the last two decades. We estimate the impact of socioeconomic and workplace-related variables on union membership by means of Chamberlain-Mundlak correlated random effects probit models, using data from the German Socio-Economic Panel. Drawing on the estimates, we project net union densities (NUD) and analyze the differences between East and West Germany, as well as the corresponding changes in NUD over time. Nonlinear Blinder-Oaxaca-type decompositions show that changes in the composition of the work force have only played a minor role for the deunionization trends in West and East Germany. In West-East comparison, differences in the characteristics of the work force reflect a lower quality of membership matches in East Germany right after German unification