Divestiture, Competition, and Regional Labor Earnings: Evidence from the Telecommunications Industry

James Peoples

The Review of Regional Studies, 2000, vol. 30, issue 2, 147-165

Abstract: Theory suggests that the divesture of a corporate monopoly such as AT&T could lead to greater earnings variations developing across the now autonomous regional companies. Individual worker information drawn from Current Population Survey files is used to investigate divesture's influence on regional earnings in this industry. This study presents evidence suggesting larger erosion of the union telecommunications earnings advantage in regions where state utility commissions encourage competition. A broader regional earnings effect is found for nonunion telecommunications employees. For instance, the earnings advantage of nonunion workers and managers in this industry declined appreciably across all regions. These findings indicate the differing regional earnings effect of divestiture and competition on the three major groups of telecommunications employees.

Date: 2000
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