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Right-to-work laws, unionization, and wage setting
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Fortin, Nicole M., Lemieux, Thomas and Lloyd, Neil (2023) Right-to-work laws, unionization, and wage setting. In: Polachek, S. W. and Tatsiramos, K., (eds.) 50th Celebratory Volume. Research in Labor Economics . Bingley: Emerald Publishing Limited, pp. 285-325. ISBN 9781804551264
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Official URL: https://doi.org/10.1108/S0147-912120230000050011
Abstract
This paper uses two complementary approaches to estimate the effect of right-to-work (RTW) laws on wages and unionization rates. The first approach uses an event study design to analyze the impact of the adoption of RTW laws in five US states since 2011. The second approach relies on a differential exposure design that exploits the differential impact of RTW laws on industries with high unionization rates relative to industries with low unionization rates. Both approaches indicate that RTW laws lower wages and unionization rates. Under the assumption that RTW laws only affect wages by lowering the unionization rate, RTW can be used as an instrumental variable (IV) to estimate the causal effect of unions on wages. In our preferred specification based on the differential exposure design, the IV estimate of the effect of unions on log wages is 0.35, which substantially exceeds the corresponding OLS estimate of 0.16. This large wage effect suggests that RTW may also directly affect wages due to a reduced union threat effect.
Item Type: | Book Item | ||||||
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Subjects: | H Social Sciences > HD Industries. Land use. Labor | ||||||
Divisions: | Faculty of Social Sciences > Economics | ||||||
Library of Congress Subject Headings (LCSH): | Right to labor, Labor unions -- Organizing, Labor unions -- Economic aspects, Wages | ||||||
Series Name: | Research in Labor Economics | ||||||
Publisher: | Emerald Publishing Limited | ||||||
Place of Publication: | Bingley | ||||||
ISBN: | 9781804551264 | ||||||
ISSN: | 0147-9121 | ||||||
Book Title: | 50th Celebratory Volume | ||||||
Editor: | Polachek, S. W. and Tatsiramos, K. | ||||||
Official Date: | 23 January 2023 | ||||||
Dates: |
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Page Range: | pp. 285-325 | ||||||
DOI: | 10.1108/S0147-912120230000050011 | ||||||
Status: | Peer Reviewed | ||||||
Publication Status: | Published | ||||||
Reuse Statement (publisher, data, author rights): | Copyright © 2023 by Emerald Publishing Limited. This AAM is provided for your own personal use only. It may not be used for resale, reprinting, systematic distribution, emailing, or for any other commercial purpose without the permission of the publisher. | ||||||
Copyright Holders: | Copyright © 2023 by Emerald Publishing Limited | ||||||
Date of first compliant deposit: | 31 January 2023 | ||||||
Date of first compliant Open Access: | 31 January 2023 | ||||||
RIOXX Funder/Project Grant: |
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