Declining Unionization and the Despair of the Working Class

Kelly Chen and Samia Islam

Journal of Law and Economics, 2023, vol. 66, issue 2, 279 - 307

Abstract: While the effects of labor unions on objective conditions have been extensively studied, little is known about their role in individuals’ perceptions of economic circumstances. We investigate whether union density affects the subjective well-being of area residents by exploiting the staggered adoption of right-to-work laws in the United States through a border-county design. We find that unionization promotes happiness for those of low socioeconomic status, including non-college-educated residents and current or former blue-collar job holders, but has no discernible impact on their high-status counterparts. Of affected residents, workers stand to reap the most benefit. We also find that the favorable effect of unionization is transmitted through the assessment of improved financial situation, personal health, and workplace quality. This finding highlights the role of pecuniary and nonpecuniary benefits (for example, on-the-job safety, work-life balance, interpersonal trust, and workers’ autonomy) that unions afford to protect society’s most marginalized groups.

Date: 2023
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