In this paper we compare the changing pattern of unionization in OECD countries, reviewing existing evidence and presenting new information on union‐nonunion differentials in labor market outcomes in these countries. Our principal source of information are the micro data files of the International Social Survey Programme cross‐country surveys of 1985–87. Our analysis shows that U.S. unions have a larger effect on wages than on other outcomes than unions in other OECD countries, and we argue that the high union premium in the United States has contributed to the decline in union density and divergence of the US. industrial relations