Did Right-To-Work Laws Impact Income Inequality? Evidence from U.S. States Using the Synthetic Control Method

Jordan Jeffrey (), Mathur Aparna (), Munasib Abdul () and Devesh Roy
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Jordan Jeffrey: Professor, Agricultural and Applied Economics, University of Georgia, 206 Stuckey Building, 1109 Experiment Street, Griffin, GA, 30223, USA
Mathur Aparna: Resident Scholar, American Enterprise Institute, 1789 Massachusetts Avenue, Washington, DC, 20036, USA
Munasib Abdul: Economist, Research and Methodology Group (RMG), International Directorate, Bureau of Economic Analysis, U.S. Department of Commerce, 4600 Silver Hill Road, Suitland, MD, 20746, USA

The B.E. Journal of Economic Analysis & Policy, 2021, vol. 21, issue 1, 45-81

Abstract: In this paper, we use the Synthetic Control Method (SCM) to examine the impact of a state’s adoption of a Right-To-Work (RTW) law on income inequality. We explore possible pathways through which RTW laws may impact inequality, namely, unionization, investment, and wages. Our finding of a lack of impact of RTW laws on inequality is further supported by findings of a lack of impact of the law on these variables. Our results follow Farber (1984), who suggests that RTW laws may simply mirror pre-existing preferences against union representation. Hence RTW laws are not the primary driver of changes in inequality.

Keywords: right-to-work; synthetic control method; unionization; inequality (search for similar items in EconPapers)
Date: 2021
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Working Paper: Did right-to-work laws impact income inequality? Evidence from US states using the Synthetic Control Method (2016)
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DOI: 10.1515/bejeap-2019-0299

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