Household Debt Burden and Union Jobs: Evidence from a Quasi-Experiment in the United States

Po Yin Wong, Giorgos Gouzoulis () and Giorgos Galanis ()
Additional contact information
Giorgos Gouzoulis: Queen Mary University of London
Giorgos Galanis: Queen Mary University of London and London School of Economics and Political Science

No 123, Working Papers from Queen Mary, University of London, School of Business and Management, Centre for Globalisation Research

Abstract: This paper investigates the causal effect of household indebtedness on unionization in the United States, drawing on longitudinal data from the Panel Study of Income Dynamics (1994–2021) and exploiting exogenous variation from the 2005 Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA). Using this policy-induced variation in the cost of repaying debt as an instrument, we find that higher household debt significantly lowers the likelihood of unionized employment, with the effect concentrated in states with right-to-work (RTW) laws. We interpret this result through the lens of institutional labour market frictions. In states with right-to-work laws where agreements requiring all workers to join the union or pay union dues are prohibited, financially constrained workers avoid unionising since this might involve higher conflict, instability, or employer pushback. The findings connect household financial vulnerability to collective-bargaining institutions, highlighting how personal balance sheets and legal regimes jointly shape labour-market behaviour.

Keywords: Unionization; Union Jobs; Personal Debt; Bankruptcy (search for similar items in EconPapers)
JEL-codes: G51 J50 (search for similar items in EconPapers)
Pages: 33 pages
Date: 2026-01
References: Add references at CitEc
Citations:

Downloads: (external link)
http://cgr.sbm.qmul.ac.uk/CGRWP123.pdf

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cgs:wpaper:123

Access Statistics for this paper

More papers in Working Papers from Queen Mary, University of London, School of Business and Management, Centre for Globalisation Research Contact information at EDIRC.
Bibliographic data for series maintained by Pedro S. Martins ().